On the web this is quite a common question people ask in message boards, so here is the definitve guide to connecting your PS2 or indeed any other console to your PC.
Firstly you will need a PCI TV card with either an S-Video or composite video input, or both. My advice is be specific in your search, browse the web first to get to know which card you want then search for that card on ebay, I say this because some TV have such specific names that sometimes when you search for them you might get lucky and find one that no-one else has found just by being specific, for example the card I wanted was around £40 when I checked it out on retailers websites but when I searched on ebay for the same TV it came up with 1 item that no-one else had come across and I got it for £3 including p&p!
Then you can either buy ans S-video cable for your console (approx £3 again) or use the composite video cables that came with it (the red, white and yellow connectors). Connect either the yellow connector or your S-video connector to your TV card but rather than connecting your sound cables to your TV card connect them to your actual sound card input, this ensures you will will get the best sound possible as you are cutting out the middle man so to speak. This can be done by either purchasing a an adaptor with the white and red sockets going to a headphone connection or if you know how to do it, you can cut the wires and fix an old headphone cable to them (make sure it is stereo however, 2 wires joined).
Then enjoy your gaming with the full sound quality of your PC (mine has a 300 watt sub woofer system on it and it sounds great!) and the picture quality of you monitor.