Squeakmail, I think I had the same problem, and it was driving me mad, but here is the solution.......... I hope!
I recently bought the Sidewinder feedback joystick too, and it caused a conflict with what I thought was a creative labs sound card. The conflict was that the joystick wouldn't work at all in the game, and the sound was glitchy. I then discovered that by switching the sound off (Press 'Q'), the joystick worked fine... hmmm.... thereby the conflict.
I made numerous calls to the microsoft support desk, spent endless hours scouring their websites and troubleshooters, but all to no joy. I downloaded the FS2000 patch, (on their recommendation) and still nothing!!!
All microsoft could tell me was that it was something to do with their version of DirectX 7 which FS2000 uses, causing conflicts with that particular joystick using that particular soundcard, as the joystick works fine on FS98.
After more research, I found that my soundcard, although being soundblaster compatible, is actually based on the C-Media chipset, which is listed by microsoft as causing possible problems with DirectX 7 when using a digital optical joystick such as the sidewinder. I suspect this may be the same in your case. I contacted C-Media, downloaded an updated driver, and still nothing.
I now faced an agonizing option... do I get rid of the sidewinder, which I had eagerly purchased for the sole purpose of using with flightsim, or play without sound (a travesty in itself!), or do as the microsoft guy suggested and buy a new soundcard.....!!!
Anyway, to get to the point, after all this the solution is simple (but not so simple to find!!!). You just need to add three small lines to the FS2000.cfg file:
(Just do a find for this file in windows, and then open it in a program such as notepad)
Anywhere in that large config file, just put these three lines and then re-save the file....
[SOUND]
Channels=1
Samplespersec=11025
And hopefully, that should sort it out - you can now play it with the joystick, nice smooth sound, and not have to buy a new soundcard!
Well it worked for me...
cheers,
Jetset