In XP I captured from digital8 and mini-DV camcorders using firewire connections, not USB. There were USB devices that worked but the quality of DV-AVI files was equal to what was on the tapes and I preferred not going down in quality. The USB devices got you to many different file types and quality settings.
As Apple and Microsoft dropped firewire support for capturing digital video, it was left for users to do what they could for themselves. In my case, USB works with my newest camcorder, a Sony HD model, and I now have all of my hi8/mini-DV tapes as DV-AVI files on external hard drives, I don't have the urgency of capturing other material that way.
As computers with XP and firewire are still plentiful, and external hard drive space is cheaper than digital8/mini-DV tapes I suggest using such a setup to copy your full library from tapes. It will remain possible to do it later but maybe not as easy as using a friend's computer.
Sorry, I don't know enough to answer questions about the extent virtual or compatibility modes work or don't....