How do I sharpen a video to make it less "fuzzy" (to compensate for my video camera's low quality)?

There's a Sharpen filter under the effects menu -> Enhancement. But sounds like it will just sharpen the fuzzyness, I don't think any sharpening method will compensate for a camera's low quality.

Yup, there is only so much you can do with bad footage. For instance with my Kodak Zi8 I add a touch of sharpening and lower the resolution to mask some the poor quality. 1080 to 720 or 720 to 480 usually does the trick.