As i'm watching it now (no, i'm not a member on UStream :/ ) i read (and sees) that your TV is flashing.

Usualy it's verry simple to fix it. On many webcams can you change the refresh rate (50Hz and 60Hz). Try changing it and see if it gets better.

And if it does not, you can spend 50 US dollars on a video capture device. http://www.pinnaclesys.com/PublicSi.....D+Recorder.htm (only if you are serious about keeping Ustreaming games)
I have that capture device myself, and i'm verry happy with it. It does only record composite (yellow, red and white video cablet) and s-video (4-pin connector). So no HD.

It will be recognized as a webcamera/capture device, and should work 100% with UStream's streaming software.

The only negative thing with a video capture device is that there will be a bit delay. Never more than one second by the way.

Also, you can't connect it to the TV at the same time (so you'll be watching it in UStream's software).
Can't is not exactly right.. You can buy a cable splitter (Y-cable, or a box that allows more outputs) but it may mess up the image.

So there you got something to read and think about :P