I have exactly the same problem (Distorted audio when using any mixer option other than clean), but in my case it happens using ASIO with the Komplete Audio 6 interface. It does not happen if I use the WDM drivers instead or the Rock Smith cable, but of course the latency is much higher...
I have checked everything (Including latency diagnostics, etc), and any other app using ASIO with the KA6 (Cubase, Guitar Rig, etc) works perfectly fine, so I think the problem might be coming from Yousician itself.
The funny thing is that it only happens while the instrument (guitar in this case) is muted. If I start playing all goes fine, but in the moment I mute the strings, I can see buffer underruns increasing in the KA6 control panel (Latency fine). So this is only a problem in those moments where the song is playing and my instrument is silenced, but annoying anyway
Hope we can fine a solution or workaround to this!