You must start with a good foundation. Which means your sequence setting should match your source footage. Since you dont know the frame size of your source footage it is likly you have not setup your sequence correctly.
So; discover the details of your source footage then setup a sequence to match and your task will become very easy. If you dont know how to do wither of those things come back and ask for more help.
Going in to more detail the source file is a AVI exported from a super
nintendo emulator, if nobody knows what that is it's fine but bacislly means i can't
change the size when captureing. Howvere the demensions areLength 00:04:01 Size:449MB Frame width 256 Frame hieght 224
So create a custom sequence preset with those settings.