I did a Hangout for a work meeting recently, and the audio quality was terrible. I think we had 4 participants, and every time someone said something it would be "reverbed" like a speech in a stadium. It sucked.
Yep I had the same problem with just two participants. Then switched to Skype using the same equipment and it vastly better. I guess Skype have had years to fine-tune their technology.
As a counter-anedocte, my coworkers recently did a three person Hangout between Europe and Brazil and it worked fine, while Skype was having trouble keeping up.
I haven't used it, though.
Same thing here: hangouts work a lot better than skype (and we can even record our meetings if we are doing some kind of presentation).