I've just tried setting up Teamspeak this morning with my Mike/Headphone set....
..bleedin' Norah...!
A free headache... :o...!
What with ATC bending my ear, my own call outs, and the constant engine/wind noise in my headset, I finally had to take the headset off, and re-plug my Creative speakers back in again (With it's volume control).... ;)...!
Hells-Bells, what a racket...!!!
At least with a proper noise cancelling headset on, in a REAL aircraft, all the background noise is cancelled, and its quiet until I actually make a call-out.
I'm now going to try just using my mike for call-outs, and my Creative speakers (with volume control) to relay all the ATC and cockpit sounds... ;)...!
An alternative would be to simulate a noise-cancelling headset by reducing all the sounds (in FS 2004 Options>Settings>Sound) except the ATC/Teamspeak calls to and fro... ?
Until I have more luck in reducing my consumption of headache pills, I think I will continue using the lovely-old Chat Window...

...

...!
...sorry Lads...

...!
Cheers all...!
Paul...I love peace and quiet...

...!
Win 8.1 64-bit. DX11. Advent Tower. Intel i7-3770 3.9 GHz 8-core. 8 GB System RAM. AMD Radeon HD 7700 1GB RAM. DVD ROM. 2 Terra Byte SATA Hard Drive. Philips 17" LCD Monitor. Saitek Cyborg X Fly-5 Joystick. ...and a Briggs and Stratton Petrol Lawn Mower.