Click "source" button and there will pop-up the following dialog.(the dialog pop-up on your computer may difference depend on your sound card).

Check the green at Microphone to select, and then double click microphone(or click microphone and then select properties.)
The following screen will appear.

Click levels and the following screen will appear.

Adjust the above sliderbar to adjust recording level. If the maximum volume is still not loud enough, add the below sliderbar(microphone boost). Options include: +10db,+20db,+30db,etc.

Set as the above screen to record by line-in.

Click levels to select.

Some new windows 7 users may come up with the following screen.

Even if the microphone has been plugged in, it can say "Not plugged in". That's because there is no drive of sound card. If you cannot find it, the drive of vista still works well.