I think this is a bug in Launchbox.
When "Mute Audio During Transitions" option in Game Pause menu is enabled pressing the gamepad button assigned to the pause will mute windows. It will happen only first time this button is pressed after launching Launchbox. If you unmute windows manually then no matter how many times the pause button is pressed it won't mute the windows anymore. But restart Launchbox and first time you press the button it will again mute the windows.
This works well if you're inside a game which has pause screen enabled, it will mute the audio when you enable the pause screen, and will unmute it when transition ends. But when you're just in Launchbox menu and press the button there is no game to be paused, and thus no transition to be made. I assume the Launchbox mutes the audio and then never triggers unmute function at the end of transition... or maybe it just happens to fast for windows to notice the unmute, if for example it happens within milisecond of each other?
This also happens if you have Launchbox configured to launch Steam games, because Steam games are not configured to use pause screen (because they have their own overlay). So presing home button shows steam overlay and mutes the audio on first use. Later on it's ok.
Steps to reproduce:
Prerequisites:
* Have " Mute Audio During Transitions" enabled in Pause Menu
* Enable Game Controllers, Choose a Device (in my cause Xbox One controller)
* In Game Controllers -> Mappings map "Show Pause Screen" to a controller button. I configured it to Home/Guide (button 11), but it should work with any button.
1) Launch LaunchBox, wait till it loads.
2) Press "Show Pause Screen" button
What should happen? Nothing. Nothing should happen, because no game is running and no pause can take place.
What actually happens? Audio is muted.
Note that unmuting audio at that point and pressing the configured button will not repeat the bug again. Restart the Launchbox to repeat the bug.
Currently disabling "Mute Audio During Transitions" is walkaround for this, but ideally this should be fixed, since pausing emulated games with "Mute Audio During Transitions" is a nicer experience, since it mutes audio instantly. Otherwise there's some strange things happening with audio when Launchbox attempts to freeze the emulator process.