The final part of the puzzle that confirms to me that this is a software issue is that like many, I have now disabled the 'enhancements' checkbox to improve the sound quality (which it has) and have noticed that in Xbox Music whenever a song starts, for the first half a second the volume is much much louder and then dips to the default volume level meaning that there is a process running to do this. So its either a bug, or MS purposefully reduces the audio output as the speakers are clearly able to go louder. In the split second though, I can't confirm sound quality at the increased volume, so the quality at that level might be poor thus giving us the reason MS limits the volume level.
I can confirm that the sound level dips shortly after a song starts.
Me too. I also had a problem with different tone and output from left and right speakers... If I set the balance to little more in right channel it sounds better... Do you have this problem?
Here are the diferent failures I have found in my unit during 1 week of use...
Hope this is solved, but I'm thinking of an exchange of my unit...