You have rootkit malware and need to reinstall on an uninfected drive. Time to start over.
I'm pretty sure I have no malware or rootkits. Have run various tools and cleaners and found nothing whatsoever. The problems seem to coincide with Windows updates. I'm not noticing performance issues, very, very little spam and no unexpected pop ups. Also as many others seem to have encountered this sound issue on Dells, they all cannot have malware/rootkits surely?
Thanks again for your help.
Despite the insistence I had malware/rootkits I continued my investigation. I also noticed that Windows updated had stopped working around same time. I managed to get the updates working for MSE but not Windows. I joined the Microsoft WIndows 7 forum but didn't get much useful help. However in another old Microsoft forum I came across a similar issue regarding the updates which suggested registry errors as the cause and the proposed fix was:
Download WindowsUpdateDiagnostic and run then download MicrosoftEasyFix50202 and run.
They found several registry errors and fixed them. I did several re-boots then left PC for awhile. To my delight the Windows update function re-started and the Sound has been restored!
Hope this may help someone with similar Sound issues!