a huge part of the Dreamcast's downfall was due to the fact that it was easy to burn games for it without the need to mod it. a simple boot disc was required and you could boot CD-R backups with any retail console. some games had to have data (movies, music) ripped (or resampled) from them since the dreamcast use GD-R disks (contain about 1GB). don't get e wrong, it wasn't the only cause since competition with the PS2 was a big part of the downfall as well.
as for the sound prob, i haven't heard solutions to it yet. loading times are much faster but i prefer to play my UMD since sound is a big part of Lumines.