The above circuit shows the total of this tiny audio level meter. Audio level detection is solely by A/D in Atmega 328p. As same as my all making, Arduino bootloader (Arduino Pro) is preloaded and its firmware is re-writable by USB-TTL interface with DTR/TX/RX.

Just sampling audio signal and biased up to VDD/2 and injected in A0/A1 of atmega 328p. The actual operation can be found in the following movie... have fun!