Welcome to Spark Industries, producer of totally original and never been done before minecraft videos ;P That and whatever else takes my fancy.
Video Recording:
I use fraps to record minecraft or most other content if I will be doing things in more than one take. Other wise I use Xsplit if it's going to be all in one take(which gets uploaded directly).
Editing:
I use Adobe Premiere to edit all the pieces together from fraps, add any music or video transitions, then render it out directly to 720p video for youtube.
I don't usually upload any higher due to slow upload speeds. I am considering changing down to 480p though to help get videos out faster.
My setup:
CPU: i7-2600K 3.40GHz (8cores)
RAM: 8gb
MotherBoard: Gigabyte z68XP-UD4
OS: Windows 7 Professional 64bit
GFX: Nvidia GeForce GTX570
128gb SSD for operating system
2TB HDD for programs and documents.
2TB HDD dedicated for recording space.