I have the same exact issue, my computer had an update the night prior to this happening, I'm not sure if its related to this or if the xbox app is acting up again. I cant be in a party with any of my friends and they say it sounds like a loud crackling
noise. if there is a fix please tell me something or tell me there's one on the way.
I fixed mine by going into the advanced tab in the microphones properties and changing the format from the default.
Thank you for telling me this :D but what i was doing to get around this was connectin my controller to the pc and havi g my mic plugged in to the controller and it worked for party and games at the same time. So if this happens again for your method, heres a fall back plan (:
Can i get a step by step on this fix?
Right-click on the little speaker icon in the right-hand side of the taskbar, and click on recording devices. Double-click on your active microphone and click the tab that says "Advanced". In the drop down menu, change it from the default, I used "2 channel, 16 bit, 96000Hz (Studio Quality)".
I hope this helps