The way I implemented Application Note AVR335 from the www.atmel.com site. Software written in Bascom-AVR.
ADC for sampling the signal from a electret microphone, PWM on OCR1B to send it to the speakers. Done some small adjustment to the schematic, instead of a 1 kOhm used to power the electret I use a 15 kOhm. The gain is set with R1 and R9 (gain = R1/R9), I use a 220 kOhm for R1, get a nice amplitude to put into the ADC-input.
Will try to send this over the Internet with the Red Bokito.