A webcam system is a combination of three elements: 1) a camera, 2) computer software, and 3) a web site.
The camera I use is called iSight, which is made by Apple. It's a small video camera with an auto-focus that is mounted on a camera-holder of some sort (either a gooseneck stand, a wall fixture, or what ever is required at the time). It cannot zoom, and it has no sound input like a camcorder. It can be used for "streaming video" (live video feeds over the internet, such as for teleconferencing) or still shots (webcams). The iSight is connected to Sara's iMac G4 via a long FireWire (very fast) cable.
The web site I use is just one of my many servers I lease space on. The URL "webcam.haviland.us" is actually piggy-backed on one of my other web sites to save money. The web site is where the still photos are uploaded so that people can view them. The web page automatically refreshes (supposedly) so that you can always see the latest image that has been uploaded.
The software I uses changes. I began with Wuffcam, but it was somewhat limited in features, so I then moved to EvoCam. EvoCam has a motion sensor, which is good because when ever something enters iSight's picture, it triggers the software to take a snapshot and upload it to the web. This way when there is nothing going on, I don't use up bandwidth uploading numerous images to the web that have nothing of interest on them.
I then switched to ImageCaster, for it has the most feature-ritch menu, allowing me to do many things with it (such as scheduling what part of day the camera turns on and off, and whether it still uploads stills even if the motion sensor isn't triggered, etc.)
CRASHES: Software crashes are the most difficult aspect of running a webcam. Either of 2 things can crash: 1) The webcam software; or, 2) the video driver on the computer. A crash has many different symptoms, depending on the software I am using at the time. It can distort or split the image you see at the web site, it can move the time or date around on the screen so that they aren't where they are supposed to be, or it can "freeze" the image so that you see the same still for hours (even if the time and date keep changing). Lately I have had many of the "image freeze" problems with ImageCaster, so I have switched back to EvoCam for performance comparison.