You can use just SMS but I strongly recommend rendering with Virtual dub first because fraps file size is large but if your not rendering in Full-size with fraps then the file size should be pretty normal.
If you also render it with virtual dub it basically reduces the file size without loss of quality and that in itself isn't a very long process compared to rendering a large file in SMS and then adding to the video.
These are the codecs you need to download in order to use a Avi format that fraps uses for videos in SMS.
http://sourceforge.net/projects/x264vfw/files/