I finally replaced my audio interface with RME 800 rack to record audio into Cubase 5 using the firefire 400 cable. I use a Vaio laptop model VGN-FW27GU with the specification as below:

Intel Core 2 Duo T9400 2.53 GHz, 4 GB RAM and 500 GB hard drive, Windows Vista® Ultimate, ATI Mobility Radeon™ HD 3650

After installing the system and upgrading the software to Flash Update Tool 2.77 and Windows PnP driver 2.9992 I am able to record audio into Cubase. However during the playback of the audio I hear a loud drilling noise both on headphone output and on the main monitors. Sometimes the noise and clicks start during the audio recording as well.

Please see this Youtube video that I found from someone having the exact same issue:

Playback noise on RME 800

I Played around with different buffer sizes, sample rates etc and problem is still there. Matrix/Mix routing is not a problem either. After searching the RME forum, I found similar threats and tried the solutions but still no chance:

http://www.rme-audio.de/forum/viewtopic.php?id=9469
DPC Latency Checker says my system is fine, no latency issue. Also as suggested in this post, I brought the graphics on the laptop all way down to performance.

It's been a week that I am struggling with my RME 800 rack, reinstalling both old and new drivers and playing around with audio parameters before I post this thread. I'm eventually hopeless! Hope that you guys can help me solve this! If you need more info on my system or setting, please ask!