Sometime when you are not using uTorrent, try shutting it and WinThtottle down temporarily. I'd expect competition for hard drive access and/or CPU cycles to cause sound stuttering, rather than static / distortion, but the game could have a problem either program. The fact that the sound issues got worse with hardware sound acceleration disabled may have been due to the increased CPU demands.
[color:"orange"]Yeah, well... it's not like this o/s has a lot of stuff installled, apart from Firefox and a few others.[/color]
Well that makes it easier to re-install Windows, anyway.
[color:"orange"]Yeah, hard disks these days are quite fragile.[/color]
Actually, this was about 10 years ago that the (1GB) drive died. I replaced it with a Quantum 4GB SCSI drive, that is still going, as are a couple other Quantum drives added later (9 and 18GB). After Maxtor bought Quantum I got a huge 80GB Maxtor IDE drive, which is now considered small (but it works fine).