I'm having the same problem, and I'm using a brand new MacBook Pro 2.26 Mhz Intel Core 2 Duo. I'm not doing anything else with it but trying to record music, but I get short dropouts (not every few seconds, but several per song.) The dropouts are very short -- less than a second, but enough to create an audible "burp" in the recording. They are audible even during recording... but they're not coming from the record that's being played (I can monitor that with headphones) but from the playthrough on the Mac.
It basically makes the whole application worthless. Please, NCH, is there a solution?
I'm running Snow Leopard btw.