By default I think most sound cards are set up to record thru the microphone.
So you'll need to go into the sound card's mixer to set it to record digital
audio.. or if you have a sound blaster, 'what u hear' will work.
Some programs will encode both video and audio.. some just video.
So it all depends on which program you are using. It would be best to
refer to the programs documentation and help files.
For an overall good tutorial on this by Gold Gummibear ....
http://www.visualforces.com/ut/index.html
I'll try to find a more detailed example of how to select the proper sound
source input.. if you have your sound cards documentation it would
be best to refer to that.