Well. first of all there are plenty of pickup systems that mount a mic inside the guitar, such as a Fishman stereo blender, and Triad.
OK Grim- here's my contribution. I'm really a singer-songwriter that plays mostly acoustic, but I play one electric set when I'm playing live, and my first album had three songs that called for electric. Not having any badass boutique amps, I was screwing around with a POD Pro 2.0. I could get some approximation of the sound I was looking for, but it just had no balls. Somebody suggested that we are used to the sound of speakers moving air, which hits a microphone. That seemed reasonable, so first I plugged the POD into a Carver PM125 power amp, and then into a 1X12 Marshall cab, and stuck an SM57 in front of it. Big improvement.
But, I still had 2 problems. First, the power amp had a minor, but nonetheless annoying hum. I had put the POD in live mode, which disables the cabinet model, so the cab model wouldn't be fighting with the real cab, which had a Celestion vintage 30 in it. That speaker has quite a bit of character, and the sound wasn't ideal for everything I needed to do. And that hum was still there. Next, I switched out the cab to a Fender 1X10 wedge monitor, and switched the POD to studio mode, engaging the cab model. Considerable improvement- broad spectrum speaker cab with no character at all, let the cab model come through. But that damned hum was still there.
Well I got to thinking, "Gee, I need a power amp and speaker combination that reproduces what it's given (flat response), produces virtually no self noise, and which can accept a +4 line input." And of course, there was no way I had the money to buy it, even if I found it. Well, I looked across the room, and the light bulb just came on over my head. I plugged the line out from the POD into the +4 line in on my active studio monitors, in this case, 2 M-Audio SP5b's and an M-Audio SBX subwoofer! HUGE improvement, and that damned hum was gone. But- I still had a couple of issues. The monitor array consisted of 3 speakers, and the sub was producing a whole different frequency band. The SM57 just wasn't going to cut it.
I wound up putting an AKG D112 right on the sub, and a condenser on one satellite, and turned the other satellite off. I got my best results using an AKG C414 or a B.L.U.E. Kiwi. (OK, I didn't have amps, but I did have mics). Result? After a bit of tweaking, I could get a whole array of very good recorded sounds out of a POD. Does it sound like the amp that's being modeled? Not really , but it's *a lot* closer than a POD going direct. More importantly, if you get it dialed in right, it sounds *good*, and that matters a hell of a lot more to me than whether it sounds exactly like a Soldano VLO superlead, or whatever. We wound up using variations of the same system on the lead guitarist, guitar god Christopher Woitach, who declared it the only POD recording he had ever heard that didn't suck.
One key point- when I got it just right, it sounded like total shit in the room, until I moved into the near field. Oh yeah! It sounded just fine as long as you were 18" or so from the monitors. When you put on the headphones, the world gets OK, but if the guitarist hears this sound in the room without cans, he'll think you are out of your mind. I still use this technique today, along with mic'ing up real amps. I think this is just what Grim was looking for- the weird things we are often forced to do in project studios because of the gear we *don't* have. If I had had a nice old Roland tube amp, there's no way I would have ever figured this out.-Richie