1. Run ``alsamixer``
2. Goto capture channels (press F4)
3. Set the "Digital" Channel to a non zero value (e.g. 40). This is slightly non-intuitive but it seems necessary for anything from the internal microphone to be captured
4. Set Internal microphone as a capture device (select the channel and press the spacebar).
5. Set the "Capture" Channel to a non zero value (e.g. 40)
Beyond that, I do not know. I am woefully unqualified on Sound and Mic.
Perhaps Zabadabadoo may be able to help you when he logs in.
Did you try setting Auto-Mute channel to "Disabled"?
I have no idea what [Inverted Internal..] channel represents. You could try playing with that i.e. Unmute (if it is muted. that is unclear) by hitting "M" and set to 100% as experiment.
I think Aravisian fairly summed it up in his post #7 i.e. "You are not alone in this with that hardware:" Trouble is, evan after some websearches, I cannot see a solution.
You may have to consider using an external microphone.