Ah, prepare for a highly technical discussion of high end audio and acoustic physics folks! 
We recorded the first few shows on a microphone we bought from our local value store, the cheapest one we can find, less than a packet of ten cigarettes. This was because none of us had any money, not for aesthetic reasons. It lasted till podcast 5 or 6 I think before dying. It's a little plastic thing on a stand, and we are recording in my bedroom. The sound drops out if you are to one side of it, and if you are more than 2 foot from it you become inaudible if you do not shout, so well had to lean in and speak just to one side. Occasionally you clash heads, which hurts. Speak directly in front and it sounded like we were shouting in to the mic. I spent a lot of time trying to level out the volume on the early podcasts, to get rid of bits here it was way to loud or way to quiet. I was usually the loudest, because I operate the pc and so was nearest the mic, but also moving about. If the mic got jogged at all as we all try to get round it, it makes an indescribable noise which appears a few times in early podcasts.
What sound editing takes place is done in Audacity, (freeware version), and we learned how to use that as we went. Ironically I have in the past used Adobe Audition for projects but I don't have access to the uni these days, and when we looked at buying a copy it was about 250 times our budget, and we would prefer to spend the budget we have buying a bottle of milk so we can make coffee.
Anyway our unequal struggle with the mic ended one day when it dies. Back to the value shop for another copy of the cheapest microphone we could possibly get, and that involved waiting almost a full week till one of us had enough money. That was the first big gap of almost a week in our schedule you see: not caused by other commitments, caused by lack of $5 between two of us. (if we were students this would be acceptable. It is a bit more depressing when you consider we are all in our forties, but so be it!)
Kevin offered to borrow a decent mic off friends, after it turned out the replacement mic was faulty, and the shop would not give us a refund, so we had to wait till they get more in. Tom and I declined, because we are frightened of damaging someone's good equipment, and not being able to afford to replace it if that happened.
Then I hit a problem - Larry Sawh wanted to do an interview to promote the new Black Chicken kickstarter, right that night. I had no mic. In the end I broke the mic attachment off a broken pair of headphones, and as I now had no headphones either, recorded the sound through the speakers, dangling the broken mic over the screen and moving the speakers to try and avoid more feedback than has been heard since the Velvet Underground's White Light/White Heat album. This emergency solution turned out to not sound any worse over the muddying distorting and frequently dropping out audio abyss that is recording directly Skype from a speaker, as I can't afford a recording plug in and the free one I tried was terrible and non-functional, then demanded my credit card details! Like I have a credit card, I mean what planet? In case you have not guessed, I do not possess the General Virtue: Wealthy,and neither right now does Tom!
So it really is completely done with whatever we can find or scrounge, I have spent more than I wanted to already and will have to spend more to try and replace the mic soon, and on top of all that my internet connection is intermittent and my PC the best part of a decade old. We are not operating under optimum conditions I'm afraid.
And financial issues will finally kill the podcast too, slightly sooner than I had planned. I have free hosting from podomatic right now, but have used over 50% of the space allocated, so we might manage 15 episodes before I'm forced to give up or look for another free host if any exist. Andy's server will not handle the podcast at the moment, as he has had to restrict streaming I think, so it may well just end when I run out of Podomatic space. On the plus side, if anyone else wants to take on doing this, Podomatic have proven very easy to use and I would recommend them, but a paid account is $10 a month, or $89.99 up front a year, and I simply don't have that kind of money.
Still the good news is we have enough space left to record at Grand Tribunal, and i'm going to try and work out ways to do it, even if they involve attempting to bring more of the delegates back to my bedroom than I usually try and fail to anyway -- actually I can see plan "would you like to come to my bedroom and record a podcast?" getting me done for sexual harassment under my own policy -- grandtribunal.org/wiki/Harassment_policy . I may have to rewrite that to say misunderstandings over podcast studios are exempted! 
Incidentally, don't some of you want to sign up for Grand Tribunal UK? There is still time! www.grandtribunal.org
Anyway, I hope this detailed description of the awesome set up we use here, and the acoustic physics involved (OK, OK, there is I think a standing wave effect about six inches between my stomach and the speakers and screen, OK, satisfied? 
) and issues of budgeting and scheduling has proven a fascinating glimpse at the lives of busy top Ars Magica podcasters.
cj x
Firstly Christian no offence taken at all! It's just I don't know if people realise quite how amateur a podcast this is, till they listen to it and suffer from the awful sound quality. It normally takes about an hour to record a whole podcast if there is an interview, or closer to 45 minutes if there is only Tom and I here. With the interviews I then spend 2 to 3 hours editing the sound and trying to remove the word "um" as much as possible. Episode 9 actually went out directly without any editing at all, and was recorded in one take, and I don't think was nay worse for it. I did of course try to level out the sound as always though. House Flambeau has had the full edit treatment, as we had way too much material, but then after i edited the various points where Skype dropped out or we were sidetracked by sound issues i ended up having to leave a few bits of extraneous chat like me talking about my background ghosthunting tv for 20 seconds to make up the time! I have just finished episode 10 by the way.