Maybe some progress. I stumbled across this link:
http://blog.tuxcoder.com/2009/01/solving-digital-audio-playback-issues.htmlThis guy, Casey, sounds like he's describing my Link:
"Today I spent hours debugging the digital audio output on my XBMC system running Ubuntu 8.10 (Intrepid Ibex). "
Two symptoms he and I share: Sound would just stop randomly and sometimes XBMC could play movies, but not music. I have not tested his simple solution yet as my Link refuses to stop making sound. I will post results eventually.
Hope this helps the last stubborn folks still using the Gamma hardware.
Martin