Laptop to TV issues with error message

I am wondering if you can help with this problem. I have a new Dell Inspiron 1564 that I am trying to connect to my LG plasma TV in order to watch media files. My problem is that the video shows just fine but the sound doesn't work. I have done all the usual right clicking the speakers in the bottom corner and making the HDMI output the default but it hasn't worked. I've had Dell control the laptop remotely to check the settings and they agreed that they were correct, so now I don't know what else to try. I've googled until my eyes hurt but can't find this particular problem.

The thing is, my old Inspiron 1525 (which I no longer have) worked fine, no problem with the audio. The digital tv also works fine. Which makes me think it's not a problem with the TV. When I connect the laptop to the TV and use the 'Test' funtion to see if the sound is working properly I get an error message saying something along the lines of 'this device is in use, please end any programs that may be using it before trying again'. The man from Dell said this was what it should say but is that right? Does anyone have any idea how to get it working.

No experience with HDMI but have a couple of suggestions.

When you right click on the MS speaker icon and select playback devices you have HDMI set as the default output correct? If you single left click on HDMI do you have an active "Properties" button in the lower left? (also a configure button on the lower right)

If so select it. What tabs do you have showing?
Is there an enhancements tab? If so check the "disable all enhancements" check box.
Look for any other pertinent settings.

If the configure button is available you may want to see what's listed as active.

It's possible newer HDMI drivers might be required... seems to me like it should work as advertised though.

Ap