After a lot of time fidddling with audio settings, I want to share my experience.

I use Skype, Audacity and a Logitech camera.
My micro is a USB.

AUDACITY

edit | preferences | PLAYBACK: Microsoft soundmapper
RECORD:Realtek MC97 Audio (My sound card, I guess).

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SKYPE

Tools| Options | Adjust sound devices |AUDIO IN Realtek
AUDIO OUT Realtek

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LOGITECH QUICK CAM Camera settings | audio | Primary audio capture device: Realtek

Dennis