This is how I got mine hooked up.
The Master Out from my mixer goes into the Line input of the PC. I use the "Y" cable with RCA on one end a headphone jack on the other end.
Go to the computer's Volume Control , click on the Options menu and open up Properties.
Once you're in there, click on the Record tab (it should show a list and make sure Line In is checked off). Then click, OK, and you should be in Recording control now. Just make sure Line In is selected.
Thats how my set up is.