I've been having similar issues and was getting pretty discouraged overall with my gear. I tried all the various input settings and adjustments with no luck at all. The other day I was playing around with the OUTPUT settings and changed to STUDIO DIRECT. Bingo... clipping gone, tone clear, recording levels usable, headphone tone sharp and clear, nice distortion... I am using the XLR outs to Steinberg UR-22 into Studio One... so far seems like the solution for me... Shure SRH440 cans...
- VERY IMPORTANT -
The VOLUME knob (Ch. Vol on the amp block in HD Edit) is a tone-independent volume control that affects the output level of the amp block. The Master DEP (down by the Hum and Bias controls) is what should be used to get a "pushed" power section, not this control. I recommend keeping this knob at conservative levels (~50% or less), otherwise you can get unwanted clipping - either of sensitive downstream effects like many of the EQ's or of the Pod's internal digital resolution.
This is from MeAmBobbo's excellent PodHD Guide: http://foobazaar.com/podhd/toneGuide/. If you haven't read it yet, you should. It will save you a lot of trouble and heartache...