There is one podcast and poster who just set up Audacity and Skype and he’s been recording his Skype podcast ever since.
He was, as we say, supersonically lucky. That doesn’t work for most podcasters who try it. They all get what you got: “I can’t hear the far end, the sound is garbled, etc.”
Neither Skype nor Audacity play well with others. They both struggle for mastery of the microphone and speaker and it’s usually the user who loses.
Pamela is the paid solution. It (she?) knows all about Skype and how to correctly manage the sound channels. It will give you two different high quality WAV recordings, left and right, with you on one side and the guest on the other. This will let you apply corrections to one side without affecting the other.
You don’t have to use a paid solution. There are freebies out there, but beware of programs that automatically mix near and far or insist on producing MP3 instead of WAV.
I did my podcast test the hard way. I threw hardware at it. This is the two computer and mixer version.
This is a very ratty podcast we shot.
Denise sounds like she’s on the sofa behind me, doesn’t she? She’s not. She’s four time zones away.
This is how the better podcasts do it. The control is much better and you can add guests and other sound effects if you wish. This is how the Pando Podcast shoots their show.
Most of that reduces down to two computers and a mixer. He, for example, is probably playing Angry Birds.