With xpra 0.8.6 sound only works if one connects using a command line- with the GUI launcher there is no sound.
Tested on Windows 7 client and ubuntu 10.04. Behavior is the same.
Confirmed - this is fixed in trunk, so low on the TODO list. (and whatever the fix is, it cannot be backported easily as there were a lot of changes)
fix for 0.8.x branch is in r2801 (trunk was not affected)
this ticket has been moved to: https://github.com/Xpra-org/xpra/issues/268