At least you got a driver disk, but it sounds defective to me. I'd return it since no webcam I have or my friends never sounded that bad.
One idea. Is there enough light? Some of these do that in low light.
I bought this webcam on ebay because I thought it was cool that it had 6 on-board LEDs, yet when I got it and installed it, the image is horrible - I look like something out of a J-Horror film (where my eyes should be white it shows up yellow, with light gray, almost clear irises and my nails are yellow, too; also shows a light gray skin tone when in real life I'm a medium brown). I contacted the seller and was told that the camera has ''settings'' (like I wouldn't have already tried the settings); problem is, the settings don't improve the problem one iota.
Has anyone else had a problem like this with particular camera, and if so, is it resolvable?
Thanks in advance.
It is likely that the six LEDs around yur camera lens are Infra Red emitters. The colours you describe sound like the result of IR lighting.
To test this theory, turn off ALL the lights and see if the camera can still "see" you.
Try covering the LEDs (maybe with a few small pieces of black tape) and then add enough room lighting to get a better image.
Cameras that make great holiday gifts
Let them start the new year with a step up in photo and video quality from a phone.