http://discussions.apple.com/thread....101668#3101668
There's a fix for it there.
I have mine set to 44.1KHz/24bit and its working good now.
Just play with the settings in QuickTime until something works for you, or you can go back to iTunes 6.
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I have isolated the problem to the sound settings in quicktime. Under the "audio" tab in quicktime's preferences you can select the type of sound output for audio. Setting to anything above 48khz results in crackling on my Audigy 2 Value Card and 24 bit sound results distorted audio so much so that it's not possible to listen to. Changing these values to 48kHz and 16 bit sound solved the problem for me. Just be sure to restart itunes if you want the settings to take effect. Hope this helps until apple solves the problem.
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