Well, I went and picked up a new power adapter today, and it noticably improved the sound quality from the rear and center channels, however it had no effect on the 'low bass' that I was experiencing in windows and in games.
That said, I was able to get the great bass that I was hoping for! As I began to suspect, the headphones were working fine (special thanks to the great customer support I got yesterday from Medusa International). The problem (I think) was that in normal applications, no signal was being sent out on the 'subwoofer' channel. PowerDVD does its own decoding of the DVD audio and as a result sent the correct output to the subwoofer channel as well as the rest of the speakers, but my Audigy card wasn't sending any signal in other applications (because they weren't specifically outputting on the subwoofer channel). Since my speakers were all doing the 'Channel Test' correctly, I figured that they were hooked up in the right order, so I'm pretty confident this was the problem.
In order to fix it, I had to enable 'Bass Redirect' and turn up the 'Crossover Frequency' in my Audigy control panel (Bass Managment tab in the Speaker Settings panel). This setting apparently analyses the signals sent to the satellite speakers, and redirects (or copies, I'm not sure which) the low frequency signals to the subwoofer channel. Since I've enabled it, I'm able to 'feel' the bass a lot more when playing MP3's and in games.
The steps I did to turn on Crossover are:
1. Open the 'Creative Volume Control' application (the Creative-supplied sound-mixer that replaces the windows sound mixer)
2. Click on the 'Speaker Settings' button (the little picture of the speaker in the bottom of the mixer panel). This opens the 'Speaker Settings' panel where you would go to change the setting for the number of speakers (2,2.1,5.1, etc..).
3. Click on the 'Bass Managment' tab on the top of the panel.
4. Click and enable the 'Bass Redirect' option on this screen (second box down) and pull up the 'Crossover Frequency' slider (this sets how high of a frequency to redirect to the subwoofer channel). I have mine set at about 90%, but you can see what works for you.
5. Ensure that the 'Subwoofer Volume' slider is turned up.
Its pretty much cleared up all the problems I've been having! The headset is sounding great now! A big improvement!