I can confirm the microphone issue in Karmic, the internal microphone used to work out of the box but no longer picks up any sound after recent updates.
I however can't reproduce the line out issue, so it probably belongs as a separate bug. Regarding that, make sure that you were plugging it into the first (left-most) line out. For me, if I plug ONLY into the second line out, it mutes the sound but nothing comes out, it might be a bug, I just assumed if you only have one sound device plugged in it ha to be in the first port.
I can confirm the microphone issue in Karmic, the internal microphone used to work out of the box but no longer picks up any sound after recent updates.
I however can't reproduce the line out issue, so it probably belongs as a separate bug. Regarding that, make sure that you were plugging it into the first (left-most) line out. For me, if I plug ONLY into the second line out, it mutes the sound but nothing comes out, it might be a bug, I just assumed if you only have one sound device plugged in it ha to be in the first port.