Sorry, knew I should not trust my memory. Stefan, is right that there is not a size setting there just type of recording and bit rates for audio and video. But, I am pretty sure that you have to meet the site size limit and course size limits when using that plugin. Plus you have to meet the size limit set in php.ini.
Been a while since I set a Moodle up from scratch so I don't remember for sure what the default size is, but I think it is 2MB which is fairly small. That could explain your short recordings.
If you click on Site administration, then in the search box type, size, and click Search, the reulting page should show you all the file size limits. Location of the php.ini depends on your server. Got guests just came in the door, so gotta run for now.