Windows 7: Win7 + Lineage2 + Winamp

Hi.
I am playing www.lineage2.com mmorpg and trying to listen to Winamp music at the same time on my new Dell Windows 7 64-bit home premium. The model number of this computer is XPS/Dimension 8300.




Winamp works just fine by itself, but when I start up Lineage2 I get sound distortion. It happens mostly when I move my character, but not exclusively. When this sound distortion happens the game slows down or glitches a bit. Once or twice it started to glitch so bad that my whole computer froze up and I had to turn off power and reboot it. It seems to me that there might be a problem with how Lineage2 utilizes memory because once I rebooted the computer (or cleared the memory) it seemed to work again. Still glitching, but not slowing down the whole system.


I tried to run in Windows XP compatibility mode and run it as administrator but that did not help. I also tried adjusting my sounds settings. I lowered my volume sliders on my sound devices to 75% so it would limit distortion in case there was too much “power” going out of my computer and my speakers would be not able to handle that, but that did not help at all. I was not able to change priority of the Lineage2 application. I increased priority of Winamp to High (from Normal) but that did not change anything. I have upgraded ALL of my drivers, except for network card driver because it is a manual update and I don't want to loose Internet access just yet. This is my first Windows 7 computer so I don't want to mess it up just yet. I did install Ubuntu Linux on it ( just in case this makes a difference, and I am dual booting with Windows 7).
I have Service pack 1 for Win 7.


If anyone has any idea of what I can try I would appreciate it very much.
Thank you
Kelly