It is an analog transfer, so there is inherent loss. You'll want to record at the highest available settings in order to minimize loss. Note that the USB port is a USB 1.1 port, and thus can cause a bottleneck when recording at higher bitrates.
That said, as you are coming from VHS tape, you may find the 1500kbps option to be suitable if your source is LP, or 2000kbps for an SP recording.
Though, to be honest, I find 1200kbps to be adequate for LP, and 1500kbps for SP. It gets a bit blocky with fast motion, but VHS is inherently rubbish to begin with...
An alternative, if you have the time and processing power, is to record everything at 2500kbps, then use a video editor (the likes of AVIdemux) to reconvert this recording to a lower bitrate. Because a computer not running in real time has the luxury of looking at past and future frames, plus the option of two passes, you ought to be able to re-encode at around 1400kbps (from 2500kbps) with very little loss in quality. If you opt for quantiser in favour of bitrate, the bitrate will be adjusted to best represent each individual bit of video (according to your chosen quantiser setting).
Best wishes,
Rick.