One of the discussions on capacitor problems is here:
http://www.amiga.org/forums/showthread.php?t=5667If using any of the advice, read all the posts, as there is some potentially bad advice in the web links given at the start. I.E. removing SMD capacitors by "twisting" them off the PCB!
The audio problems may be caused by your CDrom audio having a low output impedance, which is connected to the high impedance internal audio connector which is probably about 10k or more. The low impedance output loads down the high impedance audio.
You can help the problem by building an impedance matching network.
Another possibility is the audio connector pin configuration. From memory the one on the Picasso IV is a 3 pin header, with ground on the center and L&R audio on either side. Like L-G-R.
Some audio connectors are 4 pins and are arranged like this: L-G-G-R.
So if you were to plug this into your 3 way header, it would effectively short one audio channel to ground.
Also as mentioned there is the Picasso IV audio switching program, but it's more likely to cause no CDrom audio output if set up wrong.
The program comes on the driver disks, and is usually copied to SYS:WBstartup during installation. It's probably run as a commodity, so use Exchange to make it pop up.