Don't know if this is going to help, lemon, but my sister had a conflict between MSN Messenger and Skpye (Which meant she could only hear me on Skype but not see me). I think she disabled the webcam facility on MSN and it's worked OK since. I should also say she has an external webcam and pc and I am running an integrated webcam on my laptop.
She talks to me and her Husband (In Saudi) and we don't pay anything. You only pay if you're contacting someone who doesn't have Skype. Skype to Skype is free.