There is a significant difference between display chipsets, such as for a monitor or projector or television, and capture chipsets, such as recording and streaming devices.
Analog video signals sometimes require being adjusted manually. With the AV.io HD, any webcam-type application would also have options for adjustments such as brightness and contrast. This would resolve the brightness issue at the very least.
I would also highly recommend updating to the most current firmware as each firmware release provides fixes for bugs that may have been found in previous firmware versions. The firmware fix and manual adjustments may resolve the issues completely.
However, if the issue does appear to persist, please test with a different video source and VGA to DVI cable to see if the issue is reproduced or if it disappears. If the issue disappears then it may indicate an issue with the cable or the output from the intended video source itself.