Yea, you don't want any clipping at all, if you have to turn the mixer output really low, then there is some point in the chain that isn't set correctly; if a level of something is really low, then you'll get increased noise. With your mixer, i'd suggest setting the preamp level, channel level and the main mix to 12 o clock, and then go from there. Adjust the mic preamp level, but be careful with it, from my experience the preamp controls on the smaller behringer mixers are really sensitive. When that is set, then tweak the levels of the channel level and the main mix, until you get a healthy level out of the unit, without either control being set too extreme. On the meters in Audacity, i'd suggest trying to get the input level to sit between the 3rd and 4th divisions- if you go over it's not a major problem, but processing is easier if you've got a bit of headroom to work with :) Also, I would suggest not using any EQ on the mixer; set them all to the notched 12 o clock position when recording. Hope that helps a little.