I found a solution that worked for me. Credit to u/LolCate on reddit 6 years ago!
- Open settings and go to Bluetooth & devices > Devices
- Scroll down to “More devices and printer settings”. Click this to open “Devices and Printers”.
- Right-click your headset (Xbox Wireless Headset under Multimedia Devices for me) and select “Properties”.
- Select the “Services” tab, uncheck “Handsfree Telephony”, and click “Apply”. I had to turn the headset off and on again, and voila! Good sound!