Check your sound property's under Windows. Make sure you did not accidently mute your microphone or line-in under the RECORDING tab.
To playback and listen to a track, is called Full-Duplex. This has to be something your soundcard is capable of doing regardless of the software used. For if the hardware can only handle Simplex, then no matter what the software can do it won't work.
It's been years since I have used CoolEdit. So i could be off basis on this. Check to see if there is a way you can reset the settings to default. Otherwise, make sure the soundcard selection refers to your soundcard and not sound mapper.
As for recording a drum beat from a drum synth, why not export the beats to a wav file, then open it under Cool Edit as a track.
If no one else can help soon, I'll load a copy on my laptop when I have time to sort this out.