I had same problem: they saw and heat me but I couldn't see them (i heard them ok).
I solved this problem many times (either pc or mac, wind xp, winf 7 etc) with turning off antivirus software (in my case avg free) and firewall on both devices/computers. Hope it helps someone.
Just this week my skype video (which was working fine - I have a built-in webcam) failed and now I can see them but no one can see me...my webcam works (tested online) but Skype detects no webcam....HELP!!!!!!!