It sounds like you are using software encoding, instead of hardware encoding - you are not using the hardware encoder on your capture card.
From the MythTV documentation CPU Type and Speed
MythTV has two modes of operation. First, it can function as a software video encoder, which means that it uses a fairly generic "dumb" video capture card to get frames of video, encodes them using the CPU on your motherboard and writes them to disk. High-end video capture cards and devices like the TiVo and ReplayTV have dedicated encoder chips which use specialized hardware to convert the video stream to the MPEG-2 format without using the motherboard CPU. The main CPU has the responsibility of running the Operating System and reading and writing the encoded frames to the disk. These tasks have fairly low CPU requirements compared to encoding video, which is why a device like a Series 1 TiVo can run with only 16MB of RAM and a 54MHz CPU.
From the Hardware MPEG-2 encoders
Here are some data points for encoding:
* A Celeron 450 uses 2% CPU for encoding a 480x480 16Mbps MPEG-2 stream.
Clearly, if you are monopolizing a 2GHz CPU, you are not using hardware encoding.