I just bought identical Dell Inspiron 1525 laptops with Windows Vista 32-bit, EN-US. After the initial, Dell FAI (Fully Automated Installation) the front panel microphone jack of one of the computers did not work. After verifying that the headset microphone worked on another computer, I checked the recording level settings from the Control Panel -> Hardware and Sound -> Sound -> Manage audio devices -> Recording Tab -> (You can stop here, talk into the microphone and actually see the volume meter moving) -> Microphone/Line In -> Properties -> Levels Tab (how user friendly).
To make sure that there is no hardware problem I rebooted the computer and started the Dell Diagnostics utility: At the BIOS startup splash screen, press F12. From the boot menu, select Diagnostics. A rather lengthy self test started which stops after about ten minutes asking if you want to continue for another 30 minutes or so ? I answered No and the usual Dell Diagnostics program starts. Selecting the Audio/Microphone test in the manual test sets I was able to record and repeat the sound through the (Intel) chipset no problem (remember you need to keep on talking all the time during the test). Therefore the hardware is not in cause but better make sure.
I restarted the system by closing all the diagnostics program windows. On Dell’s support site I spotted the device driver for SIGMATEL STAC 92XX C-Major HD Audio (the link may not be accurate in few months time, or in your country, sorry). It was actually the same version that was already installed in my system, but never mind.
I clicked the downloaded program which (re) installs the SigmaTel C-Major HD Audio device drivers. Notably it creates an entry in C:\Program Files\SigmaTel which means that it is not just a device driver but also an application and/or service.
I guessed right: at the end of the installation procedure, requiring a reboot a dialog window pops up, asking to allocate functions to the front panel jacks. It is notable that on this dialog the microphone jack on the right had a question mark on it. I told the dialog that the microphone jack is for – a microphone. Now back in the control panel (see above) the volume meter works and everything is back in order.
For the price of a MacBook I got two computers. But there is always a price to pay. Annoyances.