Quick note to self, to save some searching next time.
Microsoft LifeCam VX-1000 does not quite work on Ubuntu and even worse with Skype. To get video working on Skype, start it as :
env LD_PRELOAD=/usr/lib/libv4l/v4l1compat.so skype
And to get the microphone working, run this in a terminal
sudo rmmod gspca_sonixj sudo modprobe gspca_sonixj