click options>audio settings and fuck with the buffer length to get a better real-time recording. set it high and you get a big lag, set it low you get less, but if you set it too low you'll get a lot of underruns which is basically the sound clipping out.

if you have a badass sound card this is pretty much irrelevant, but most ppl don't so...

you can also get around the buffer problem by quantizing, but a lot of purists (aka gays) are against this. hit Alt+Q in the piano roll to fuck with that.