On to my second web cam, tried logitech and now microsoft life cam 3.0, no problem with video but can not get any audio!!

Have you set the mic you wish to use with your webcam as Default ?

XP
Plug in your webcam or headset or mic you wish to use with your webcam
Control Panel (Classic View)
Open 'Sounds and Audio Devices' folder and click on the 'Volume' tab - make sure the speakers are not muted, open 'Speaker volume' and set the sliders toward the upper end.
Open 'Audio' tab - make your preferred mic the default device in the 'Sound recording window'
Open 'Volume' below the window to ensure the mic is not muted
Click 'Apply' and 'OK'
Restart your computer
Configure the webcam / mic to your chat program

VISTA
Plug in your webcam or headset or mic you wish to use with your webcam
TEST SPEAKERS
Right click on speaker icon in System Tray or from Control Panel
Select "Playback Devices"
The speaker icon ( checked as working) and volume level graph should be visible
Right click on the volume graph and click "Test"
Left hand speakers followed by right hand should be heard

SET DEFAULT & TEST MIC
Click "Recording" tab.
Right click on the volume graph and select 'Show disabled devices' and 'Show disconnected devices'
To set your preferred mic as default - click the mic font to highlight and click "Properties"
In lower dropbox display "Use this device enable" click 'OK'
Click "Levels" tab and ramp up sliders ( adjust to suit later)
Return to "Recording". Test mic by speaking and make sure volume graph displays

Restart computer

Configure to your chat program