What it's saying is that whatever you have set up in control panel for the speech engine to use as its recording device is not the device that is selected as the current recording device.
If you go to Control panel and click, 'Speech Recognition' and then click, 'Advanced speech options', then, 'Advanced' - what does it say you have selected as, 'Audio Input' ?
Next, in the previous window (Speech Properties), there's an, 'Audio Input' button. Click on that and go to the, 'Recording' tab. What device is selected as the default multimedia device (it will have a green check mark next to it) ?
Does the information above match the info given when you double click the log message?