I've just downloaded and installed the horizontal VU meter and played a track with Winamp to test it.
It looks to me like it's just a standalone version of the VU meters that are sometimes built-in to audio editor software such as Adobe Audition, Cool Edit, Mixcraft, Audacity, etc.
As there are very little options available with the application I would suggest that it is looking at the sound card signal and if it's not responding it may be a sound card setting that needs to be enabled via Windows Mixer.
Nice little gadget though. Great for setting input levels before recording.
