but once i've converted to .wav or mp3, the skips seem to clean up a lot.
Clean up a lot? Or clean up completely?
I have one more idea, download and try to use Audacity 1.3.4, as long as you install it to a different directory, you can have both copies on your computer at the same time, they won't complain (though they don't like being run at the same time). Your problem might go away using that version of the software.
If it doesn't, I have one more thing to try. In Audacity 1.3.4, go to the Edit -> Preferences -> Directories menu. Here, turn "hold recorded data in memory..." ON. If that helps, then your problem might be with hard drive access. Either something is preventing Audacity from writing to disc all the time, or your drive is simply too slow and/or fragmented.
If you can get Audacity 1.3.4 working with that option turned on, then go ahead and use Audacity that way. It will use up more RAM during recording, but you've probably got plenty of RAM to spare. You might have trouble making longer recordings this way though, I'm not sure exactly what the limit would be.