Hi, go4peace. Good that you've resolved your problem through upgrade to PD12, but a tip for the future if you ever require the use of an analogue microphone, it's always best to connect such a microphone through an audio mixer. I use a second-hand "Realistic"(Tandy) SSM-1900, which I found at a recycling centre. It has two microphone inputs, two phono(magnetic cartridge) inputs, 4 line inputs(for cassette and/or open-reel recorder output, CD player, or any other line-level source) and has two line-level outputs, one for the monitor(connected to the Aux. input of a stereo amplifier, and the other, to my computer via the line-in socket at rear of the CPU. The output of the mixer going to the amplifier, actually goes via a 3-way source selector switch(again made by Realistic) so I can select wither what the computer is "hearing" or what signal is going to the computer via the mixer's monitor output.
It's an elaborate set-up, yes, but it works for me.. You could set up a simpler arrangement, but to get the signal "recognised", you must select the input by clicking on "device", then, from the drop-down menu, select "Line-In At Rear". This will get around the system not recognising the front-panel microphone input on your CPU.
Cheers!