Working mic hardware and crystal clear echoes seems like a latency issue caused by network/IP or software - the mic audio stream is being sent out in lots of little packets, but somehow they're arriving (or not arriving and being resent) out of sync. Just like on a VOIP phone.
If you're running some sort of network packet management software (ROG GameFirst, or whatever), try giving your Ventrillo/Skype a little more UPLOAD bandwidth. If you're not already running such software, then perhaps give it a try. Your communications app could currently be strangled by your game (or a bunch of upstreaming content, running java apps, file crossloads, etc) hogging all the available bandwidth. If you're running over wireless then you may have (or perhaps you should have?) some WiFi software component managing packet priorities instead. Know that the ratio of download-vs-upload bandwidth is hardwired into your internet provider's technical (and billing) infrastructure, and you may simply have insufficient maximum upload bandwidth available to do everything simultaneously.
Curiously, a cheap junky low-spec headset might also solve your mic problem, if it's one with old codec hardware which is only capable of recording at low quality/sample rates.
Can you test a different mic/headset on your existing setup, on the same signal path? To confirm if the "echoes" and other audio artifacts still exist?
Or can you (and your friends) move to a communications app which doesn't broadcast over open IP, something like TeamSpeak or Mumble or Curse?
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