To get Skype audio working with Ubuntu Intrepid Ibex (Ubuntu 8.10) and Dell XPS M1530/M1330 requires a few changes to the standard install.
Make sure you have added the medibuntu repository and installed Skype.
You need to enable the embedded microphone. Go to Volume Control by clicking on the volume icon. In Preferences select Digital Input Source. This will enable the Digital Mic 1 option which you should select.
Now launch Skype and go into Options -> Sound Devices. Select “HDA Intel (hw:Intel,0)” for Sound In, Sound Out, and Ringing.
Go ahead and make a test call to verify that everything is working correctly.