What was wrong with it? Too quiet and only me talking. Too many "ums."
For the next podcast, Scott and I started up a Skype conversation. I used a Logitech USB headset that I bought specifically for Skyping with friends worldwide. Scott used his iSight as a mic. I set my headset to be the input for Skype and the Microphone source for GarageBand. Scott set his iSight to be the mic for both Skype and for Quicktime. I began recording in GarageBand. Scott launched QuickTime Pro and chose File-->New Audio Recording and began recording. I said, "Okay, repeat after me: One, two, three." And Scott replied, "One, two, three." Then we had a very long conversation and whenever we had to pause or stop, we would start back saying 1 2 3. This becomes important in the next step.
After we were done, Scott exported his Quicktime Audio movies to WAV files and then dropped them into iTunes and converted them into MP3s. He then sent them to me via iChat. I dropped them into different tracks in Garageband and used our 1, 2, 3 to sync everything up nicely. I then went through and carefully edited bits. Whenever I cut bits, I made sure to split the audio on both my track and his track, so that I could move everything down the line together and keep things in sync. This took a good hour.
After I was done, I exported to iTunes and then converted to MP3.
What was wrong this time? Well, the volume was up too high on my headphones, so while Scott and I were Skyping, his voice was being picked up slightly on my headset's mic. Thus the faint buzzing you hear throughout the podcast. Also, this time I made everything much too loud, trying to overcompensate for the quietness of the first podcast.
I had the MP3 compression set to much too high a rate, and as a result our podcast was a meaty 20MBs in size. Since then, I've re-compressed the file and it's down to half the size.
This seemed to work very well for getting Scott and I both sounding clear. Much more effective than the record-the-iChat / Skype audio podcasts I've heard around the web.
Now to figure out how we're going to manage our next podcast with 5 TUAWers chatting...