it can't be lag, your rig is too good for that

let me ask you this, what joystick are you using?
some time ago i ran into a fairly similar problem while trying to use the Sidewinder Force feedback with a soundcard i'm not sure if it was compatible
i think this might be a longshot but since you said your sound is choppy, i think it might be the same thing i had,
i was getting choppy sound too
if you're using the Sidewinder, then try disabling force feedback, see what happens