Skype is definitely the programme to use.
As for jerky framerates, it is a multiple issue thing. It could simply be the device you are using, the connection speed of the uploading, their connection speed and all sorts of various factors.
Webcamera's definitely have tons of functions to them that sound useless, so look at the direct specifications. For that camera -
Max. video resolution - 1,600 pixels by 1,200 pixels
Max. frame rate - 30 fps
It looks like it will do a very good job. You can obviously go for cheaper models, which should be able to do the job. It is just a matter of picking a price range and going for something you are comfortable with.
You will want at 20-30fps streaming rate for the camera though.
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