Hi- yes, files will be pretty large for the low quality video due to the encoding. Modern high compression formats require a lot of processing power and memory, the TinyTV 2/Mini AVI format is just JPG frames and uncompressed audio which allows it to be decoded by the microcontroller inside the TVs.
I haven't really heard that feedback before. The app is a simple UI for FFmpeg, which is pretty widely used. Converting video requires a lot of processing power- it's CPU only and maybe only single threaded, so your processor might be at the highest frequency when running it. It's probably converting faster for you than other people with slower processors, but will definitely use a lot of processor time/create some heat. Not sure what we could do in this area, let me know if you have any thoughts.
Thanks,
Ben