You can use the Guitar In switch and experiment with PAD and NORMAL.  PAD should reduce the effect of super hot pickups such as your guitar seems to have.  Rolling the volume control on your guitar back a little bit should lessen the undertone of distortion you're getting and help determine that it is the guitar - as should trying a different guitar or several different guitars that have their stock non-active pickups still installed.   Additionally, a trait of some active pickups is that they can start to give a slightly distorted tone when the battery needs replacement, so if you haven't replaced the battery in a while or you habitually leave the gutar cable plugged in over night when you're not playing the guitar, your battery might be pretty much drained ;-)

What do you have the Output Mode set to when going direct for recording (should be Studio/Direct with cab emulation ON), or Combo Pwr Amp if going direct to the power amp section of a valve combo Cab modelling might be better ON or OFF depending on the combo in use - you'll need to make a judgement call

I doubt whether the problem is with the HD500 TBH, but of course it could be, however you do need to rule the guitar out as a potential cause.  If the guitar's output is simply too hot and is causing some kind of clipping then you might need to get an instrument cable made up that has some in-line attenuation built in (i.e. a resistor in simple terms) but this may roll off some of your desired tone too.  To determine the value of the correct resistor you could make up a simple variable pot plus two jack sockets (one in and one out) in an electronics project box (metal is probably best as it will screen the connections) and put that box in-line with the guitar to HD500 Input, then set it to where the clipping is gone and measure the resistance with the guitar disconnected or you could just use the box as a variable attenuator all the time with that guitar which would be the easiest option.

Nick

I have the same issue with my active EMG 85/81. I thought it was the pickups at first, but then I tried plugging straight into my amp, bypassing the POD, and the cleans sounded fine. I also tried the 18v mod on the EMGs, which helped, but it made my cleans ridiculously dynamic. Almost like a compressor pumping away. I tired rolling the Vol knob, but that didnt help either. Passive pickups dont clip the POD, only actives. I use the bean, so no input pad for me.