Another story of technical trials and tribulations to share in case it helps someone else out there in Google search land.
I had been attempting to stream live analogue audio from the ‘Line In’ jack on my motherboard’s embedded sound card, but no matter which settings and drivers I used, the resultant digital output always included a constant annoying clicking noise.
The motherboard is a Gigabyte GA-MA69VM-S2 which has the AMD ATI SB600 chipset and Realtek ALC888 audio codec. I am running Fedora 9 and used the snd-hda-intel kernel module. I found plenty of suggestions about adding various module parameters to modprobe.conf, including enable_msi=1, position_fix=2 and model=6stack-dig, but none had a positive effect. I also checked the interrupts and disabled any conflicting hardware, but still no joy.
In desperation I gave up on the embedded audio and purchased a cheap Asonic 16-bit PCI sound card (£5.50 from Ebuyer). This card has the C-Media CMI8768 chipset and uses the snd-cmipci kernel module. This setup worked out of the box and provided crystal clear audio without changing any other settings, so I can only conclude that either the embedded ALC888 or ALSA drivers are broken in some way.
In conclusion, if you are experiencing a similar issue my advice is to ditch the embedded audio altogether and use a different card.