If you are playing a DVD on your PC and plug the TV-Out in your VCR, there is something called Macrovision Copy Protection that distorts the video signal in such a way that it will look fine on a TV, but your VCR gets all confused by it and the movie will flicker, change brightness and colors all the time and won't be viewable.
That's something i encountered with my ASUS V7100 with tv out.
Also make sure you use a video cable, which is better quality than audio cable and is shielded. But that will only improve picture quality. The black and white thing sounds strange to me.
Perhaps you should try other drivers? I personally think that the ASUS drivers work best for the TV-Out. I had somne problems with the NVidia Detonator drivers and the so called Twinview. I only swith between Monitor and TV, i don't use them at the same time.
If you still have a black and white picture on your tv, then maybe there is something wrong with the TV-Out chip? I hope not, but [-peep-] happens.
good luck!