This annoying behaviour is caused by limited Bluetooth bandwitch when using both mic+headset channels. It's quite well explained here: https://www.howtogeek.com/354321/why-bluetooth-headsets-are-terrible-on-windows-pcs/
Here's the salient part for your issue:
Technically, when you’re just using the headphones as a sound output device, they’re using the A2DP Bluetooth profile, and ideally using AptX for maximum sound quality.
When you need the microphone, they’ll use the headset profile or hands-free profile (HSP or HFP). This allows for both recording via the microphone and playback via the headphones, but the headphone sound quality is terrible when using HSP or HFP.
If you’re just using a Bluetooth headset to take a phone call, that might be fine. If you want to speak into your headset’s mic while listening to music, playing a game, or watching a video on your PC, you’ll be frustrated.
For a PC headset with an integrated microphone, Bluetooth is a terrible choice. You’re better off getting a wired headset, or even just getting a separate microphone.
Bluetooth 5.0, which has already been announced, offers much higher bandwidth. This should let future Bluetooth headsets play back audio at high quality while the microphone is being used, in theory.
There are three basic types of Bluetooth radio range: Class 1, Class 2, and Class 3.
Here are the maximum and expected/average ranges for each class:
You'll never see the maximum figures in the real world, because:
As a result, depending on how polluted your environment is with 2.4 GHz signals, you might only get 10% of the advertised range, or even less if you try to put another barrier (like a wall, or a monitor) between the two Bluetooth devices.
Recent Bluetooth chipsets in laptops, desktops and smartphones nowadays are starting to be Class 1, but it wasn't long ago when they were all Class 2. I haven't seen Class 3 transmitters in anything that does Bluetooth audio, but I wouldn't be surprised if there were some on the market.
One thing to keep in mind is that, in order to get a higher class range (like Class 1), both your transmitter and your headphones must be capable of transmitting in that class, or your range will be limited to the lowest-class device you have. Bluetooth is a "bidirectional" protocol, meaning that your headphones also send data back to your audio transmitting device.
If your headphones can "hear" the audio data signal from your transmitting device just fine, but your headphones are of a lower transmitting class and can't send the response data back at a high enough gain for the source device to receive it reliably, you'll get dropouts.
To get an idea of what it's like to have a Class 1 Bluetooth setup, consider mine:
With my desktop, laptop or phone and the headphones above, not only can I leave the room with my headphones, but I can walk across the hall, into another room (through two walls), and still get a reliable signal with no dropouts. The entire floor of my house is within range of my Bluetooth headphones (about 55-60 feet), even with walls in between my transmitter and headphones.
In noisy wireless environments, like in a densely populated city street, Class 2 devices often have a range as low as 2 feet, and will drop out if you put your phone in your pocket. With a Class 1 setup, you can comfortably listen to audio with no dropouts on your smartphone or laptop while holding it or wearing it somewhere on your person, even in areas with some of the most crowded wireless spectrum.
Because WiFi devices share spectrum with Bluetooth, your Bluetooth range experience will tend to be very different if you live in a densely packed apartment in a city, vs. living out in the country or suburbs. In cities you might have 50 or 100 2.4 GHz wireless base stations within range; in less populated environments the number would be much less. You can probably at least walk around your bedroom with no problem with Class 1 even in a city, though.
I had this problem for a while and probably also a combination of solutions was required. Still, I think that in my case the problem was that the headphones had a double bluetooth connection with my laptop and was jumping between connections: the normal Audio bluetooth connection (HD 350BT) and the More Devices connection you mention (LE-HD 350BT) that is part of a related driver. I unpaired the LE-HD connection and kept the standard audio bluetooth connection (also with microphone). Now it works perfectly.
I think the LE-HD connection has more features to combine with other applications but it probably also consumes more battery life of the headphones.
