Adding microphone/amplifier to Gumstix Overo Earth COM?
The Overo COMs have line-level inputs and outputs. You're right that if you want to drive anything other than a line in on a stereo or amplified speakers, you will need to hook up an amplifier. It can be as simple as a little transistor amplifier or LM386 op-amp, or as complex as the guitar amp on "Back to the Future." :-)

Adding a microphone input to the COM will also need an amplifier, as you've already mentioned. If you just want to get up and running quickly, I suggest something like this SparkFun kit; it's only mono, but you can connect both the left and right inputs of the COM to the output of this without trouble.