Thanks prcguy. He wants to re-transmit his satellite radio feed, which runs through his receiver/amp in his living room. He is a musician and knows about mixing, etc and I had told him to experiment with the audio drive from the receiver, which he did. The transmitter is one of those Chinese things (which he wanted because it had an ac power supply), and he does run it on the low power setting. He also tried the jack on a Scosche fm tx and it too suffered distortion, but neither unit did when fed from his computer audio. To me, this seems like it is a problem with the jack, a mismatch, or some other problem with the stereo receiver.
I warned him about the famously sloppy signal from those Chinese desktop transmitters, but checking with my car radio it only seems to get out about 20 meters, and his house does have a metal roof, hopefully it doesn't transmit unwanted spurs. He wants to get a new receiver because of this problem, but his receiver works just fine. I am going to take a look at his sat module that feeds the stereo, maybe he can take the signal from there. He has good luck selling stuff on Craigslist, so maybe he can change units painlessly, but I hate to see him go to that bother if it is a small issue like attenuation. I am going into the big town nearby with him today, maybe we can get an attenuating plug to try somewhere. I have tried to convince him he can get good music from internet radio, a great favorite of mine. He has been receptive somewhat, but likes his sat radio a lot. Internet radio is my new "shortwave" Some of you would not remember that when we wanted to hear news or music from the rest of the world we had to work with the vagaries of the ionosphere and undergo an aural beating of all sorts.