mcdonalds3000,

i was also having the same problem (distortion, noisy sounds, poor quality of audio in headset).

to solve this:

U need to plug the pin with little force (i mean it, u should hear a "tic" sound once its plugged in properly).

i have been using N8 for the las 5 months n no issues, except the ugly shape. video/pic quality is unbelievably superb.
hope this helps u.