I was quite annoyed with the sound quality of my Santa Rosa MacBook, i.e. a MacBook3,1. I had upgraded to this machine via a hard drive swap from the first generation Macbook, and now there was much noise on the headphones.
Today I found out that I can get perfectly fine audio by starting Audio MIDI Setup (in Applications » Utilities) and selecting 2Ch-20bit (or 24bit) for the headphones, instead of the previous 16bit setting.
Mac OS X Hints
http://hints.macworld.com/article.php?story=20090729165848939