2d Quality Settings
On the NE of the main window, there are the audio and video quality sliders. As already mentioned, these control the quality of the encoded file and thus it's size. Even though the defaults are both at 100 ,you should probably change them to something lower, especially if you plan to publish your file over the internet. For video recording, you can obtaining a very good quality/size ratio around 25 to 50 %. Anything above that will probably increase the size a lot and will have very little visible difference, in quality. If you are recording a large area of your desktop, the size of the audio stream will occupy only a small part of your resulting file, so you might as well leave it at 100%. Otherwise, you can lower it according to how compressed you want the result to be.
Setting the compression higher(lowering the quality), will make encoding last longer, up to several times. So if you are just experimenting or making captures that last only a few seconds, you are probably better off setting it at 100%.
recordMyDesktop can also encode simultaneously with the recording. If you are using this feature (not recommended for anything else than experimenting with the settings), the quality should be at 100% for both audio and video encoding. This is because the amount of CPU that is required to create files with higher compression, might(will) severely disrupt the flow of your recording and make it very hard to obtain a smooth video.