OK if you have a pc with Win XP or better you have half the kit already. Next you need to get from analogue to digital, this can be done using a digitiser such as this, some tv cards also feature an analogue input so you may aleady have this.
Maplins �20 but can be found cheaper if you look around. Thing to look for is composite video input, this is what your VHS produces.
http://www.maplin.co.uk/Module.aspx?ModuleNo=2 18064
The above will come with capture software too so that's got the vhs onto your pc. Now you need to clip it up using either win movie maker or a desktop editor of your choice.
Next you want to read through this lot to find out the limits and what file formats Youtube supports. They also do videos of how to do all this if you need extra help.
http://www.google.com/support/youtube/bin/topi c.py?topic=10521
The vid should be no more than 10 mins long or 1Gb in size. It can be in avi mov wmv or mpg.