Last night Timtron and I were discussing this, I've done all his mods but we both came to the conclusion that there's something else in the transmit audio path that is causing problems, which we think is the mic amplifier.
First of all, here's a link to the manual for the 901:
http://bama.edebris.com/download/yaesu/ft901dm/FT-901DM_v6.pdfPage 24 (PDF page 27) shows the carrier unit schematic (which contains the mic amplifier), page 27 (PDF page 30) describes the transmit audio path for SSB, and page 28 (PDF page 31) describes the transmit audio path for AM. Notice that they use two amplifiers, one for SSB, and one for AM. The circuit for the amplifiers themselves are the same, but the input for the AM amplifier is different. On SSB, the mic input goes into pin 2 of Q706 (TA7063P IC) through a .047uf cap (C727) and a 10k resistor (R731). On AM, we have a completely different circuit, which looks like some kind of filtering. The audio is fed into pin 2 of Q705 (TA7063P IC) but first it goes through R717, which is a 3.3k resistor. On either side of R717, there is a 240 pf cap to ground (C718 and C719). After this it goes through R718, which is a 1k resistor, and C720, which is a .047uf cap, after which it is at pin 2 of Q705. What is that extra stuff doing? The mic input to this thing is 600 ohm, so it seems to me like that 10K on the SSB side is too much. Should I make the AM side look more like the SSB side, by removing R717, C718, and C719, then switching around C720 and R718, so that the audio goes through the .047uf cap first then through the 1k resistor, which is the opposite of how it works now?