Free thats good, and allows editing, titles etc, erm no.
Just to compress before upload, virtual dub is excellent and free and allows for true 1080p as long as the ripped footage is of required resolution.
http://sourceforge.net/projects/virtualdub/
This vid was made by me a couple of years ago, just using virtual dub from raw fraps footage.
Windows movie maker will allow compression and editing/tiltles etc, but it rapes the quality, i think its crap personally, but you should have it already.
Most people use either Sony Vegas or Adobe Premier (what i use). Cheap they are not (legally).