This is the single most important aspect of successfully setting up FreeTrack: on the "Cam" tab (right side of FreeTrack as you open the program)
you have to see the LED dots and nothing else.
If that doesn't happen, you are doing something wrong, as the guys before me suggested:
-> you have parasitic light sources - remove them or change to IR LEDS + visible light filter for your camera (exposed photo film works best in my experience, or you can try with the floppy disk material);
-> your camera settings are wrong - set the camera in such a way that you will only get the LEDs. This might not be possible in daytime with visible light LEDs unless you have some serious blinds at your window.
The quality of the dots

is easilly checked not just by looking at them on your screen but also by watching the lower right corner of the FreeTrack window: you have to see the
green dot things lighted up at all times (during head movement also).