Don't know if this makes sense to anyone, but here goes.
I have modded my xbox with a digital RCA jack. Works great. Games sound a million times better, DVD audio gets passed through without problems, Dolby Digital, DTS, no problem. The only problem I have is with XBMC. Whenever I play an mp3 it seems as if the volume is too high, causing distortion problems, especially audible in voices.
Playing (DivX/XviD/DVD or whatever) movies, there is no problem and the sound is noticably lower in volume.
I'm using an april '04 build of XBMC.
Anyone else experienced this behaviour?