Hmmm… It seems to be an EasyCAP clone, there are several devices in this form factor with different chipsets. As far as I’ve looked, they all will stream lossless interlaced video and it’s up to you how to handle it. The “720p” claim in the listing is likely bogus - the seller just misread the actual spec, which is 720x480i for NTSC and 720x576i for PAL. The last time I was capturing video, I used the VirtualDub software, which can store the raw capture in HuffYUV, however OBS can also capture interlaced video with decent compression. This capture device seems to be labeled as “BR116” based on photos in reviews, which can help identifying the chipset. BR116 is sold by Conrad and its manual by them mentions “STK1160” in a screenshot, so this Amazon one most likely also uses the STK1160 chip, which was one of the worst ones in this timebase stability test (which means it has no TBC). However, it’s alright if your VCR is a late model that already does TBC internally.
So, uh… The EasyCAP device passes both fields into your PC but the video says that the driver does not interpret them correctly and uses probably the most common, incorrect deinterlacing method (see earlier comment with the method list). It is technically possible to reinterlace the video but I haven’t needed to do that, and you should do so before any lossy encoding to a file. I assume the community-written Linux driver has no such issue.
The tutorial is mostly correct for people who want to create YouTube uploads with just one program (for YouTube, progressive video is required and the 480p stream cannot be 60 fps and has a terrible bitrate (and 576p for PAL is not available AT ALL so 1080p60 makes sense) but I strongly recommend not deinterlacing nor scaling in OBS, you can do that later. Record 480i (interlaced) files at very high bitrate and perform the deinterlacing in post.