The recording devices on Vista & windows-7 may not appear in the recording devices tab, but can be made to appear …
It is common on Vista and 7 that not all recording inputs are automatically enabled in the Recording tab. This means they are invisible in that tab, and also invisible to recording applications like Audacity. So you need to make them visible, then enable and make default the one you want to use
Right-click anywhere inside the Recording tab and choose “Show disabled devices” then right-click again and check “Show Disconnected Devices”