Key Paper! Sorry for the late response, sorry for the late response!
I don't see anything immediately wrong with your setup. Are you following the walkthrough video?
oh my gosh, i had not seen this- how embarrassing!! Thank you so much for linking it 😭 thank you!!
EDIT: after watching the video, I've realized that when you go into the properties of creating the game capture, a little preview of the character pops up in the box! Mine isn't doing that...and I followed the set up pretty exactly! It could just be my computer, so I'll keep looking into it!