jaddams, video can take alot of megabytes even gigabytes. You could buy a video mixer such as this (I found a used one for $150):
http://www.filmandvideomagazine.com/...irol_mixer.htm
With a video mixer you can super-impose the karaoke lyrics screen over the video. The video could be playing from a DVD on the PC or external VCR. You could also put the singer in the background using a camcorder.
Steve