When you sent up a music track as "boot", it's only going to be playing that one sound, which is easy. When playing a smoothswing font, the saber has to play 3-5 sounds at the same time, which is much harder. However, that may or may not be what is causing the crackling.
First thing to do is to hook up the serial monitor and see if you see "audio underflow" messages show up when the crackling occurs. If that happens, try a different SD card to see if that helps.
If it's not audio buffer underflows, it could be something in the smoothswing algorithm itself which is causing some volume control to go up/down really fast, which would also sounds like crackling.
The animation stuff is weirder though. Is your blade solid or animated? I'm just wondering if maybe the connection to the blade gives up sometimes, but it's not very noticable because the blade is mostly a solid color?
Maybe try it with the rainbow blade and see if it's just missing clashes, or maybe the whole blade is freezing up?
Running at 120Mhz should be fine, but check for heat. If the chip gets too hot it could cause problems.