Yesterday I tried to use my headsets microphone for the first time after upgrading to Windows 7 64bit.   The sound was so muted that it was inaudible.   Boosting levels and changing recording quality changed nothing.  After reading numerous “try this, do that” forums posts I finally found the one that worked at
In short:

  1. Right-clicking your volume control icon
  2. Go to “Playback Devices”
  3. Click  the “Communications” tab
  4. set it to “Do nothing”

On a side note, Windows 7 seems to include so many checks and balances to keep sound volume in balance that the microphone gets almost muted.