While many pop stars continue to settle for taped concerts or a string of MTV clips as ''long-form'' videocassette releases, some multifaceted musicians are doing more to explore home video's possibilities. In Time Capsule, the folky rock group 10,000 Maniacs supplements the usual promo clips with home movies, a student film by keyboard player Dennis Drew, TV broadcasts, and other live performances. Natalie Merchant, the band's singer and Time Capsule's creator, also throws in a fascinating 40-year-old film portrait of Jamestown, N.Y. (the group's home), and an incongruous public service commercial about homeless children, which she codirected.
Merchant, the Maniacs' creative leader and visual focus, upstages her reticent bandmates throughout this tape. A highlight: Merchant's tender, live rendition of John Prine's sweet ballad ''Hello in There,'' sung as a duet with R.E.M.'s Michael Stipe, with guitar backing by British protest singer Billy Bragg. B-