Thanks OldCpu for your time once again. 
This time around it is not surround sound that is causing problems (my alsa works correctly now), but I don't have system sounds at all.
If I run "pulseaudio" from console I get the following:
Code:
pulseaudio
W: core-util.c: setpriority(): Permission denied
W: main.c: setrlimit(RLIMIT_NICE, (31, 31)) failed: Operation not permitted
W: main.c: setrlimit(RLIMIT_RTPRIO, (9, 9)) failed: Operation not permitted
*** PULSEAUDIO: Unable to connect: Connection refused
W: alsa-util.c: Device hw:0,0 doesn't support 6 channels, changed to 12.
W: alsa-util.c: Device hw:0,0 doesn't support sample format s16le, changed to s32le.
ALSA lib conf.c:3843:(parse_args) Unknown parameter 1
ALSA lib conf.c:3969:(snd_config_expand) Parse arguments error: No such file or directory
ALSA lib control.c:909:(snd_ctl_open_noupdate) Invalid CTL hw:0,0
E: module-alsa-source.c: Failed to create source object
E: module.c: Failed to load module "module-alsa-source" (argument: "device=hw:0,0"): initialization failed.
E: main.c: Module load failed.
E: main.c: Failed to initialize daemon.