input distorts on setup:Configure Tracks page

[CraigK]

 I’m trying to set up my Electric Guitar input, using a Focusrite Scarlett 2i2. In Audio Gear setup when I'm on "Select & Test Audio Gear the guitar sounds fine (in only one channel). When I press next and go to the “Configure Tracks” page, the guitar is coming through both channels and is quite distorted (like a distortion box has been added). 
All of the levels on the 2i2 box or in JamKazam are set quite low and there's not clipping showing at all. No matter how low I turn the imput I get the distortion.
 If I proceed to step 5 (“turn off direct monitoring”), when I press play I hear the background tone clearly, but the guitar is still distorted.
 This is not happening with  other software. 
Any ideas?

You do have your Audio Interface input set to Instrument, not line, correct?

Yes, set to instrument for sure, but thanks.