After Wirt and Greg sing "Adelaide Parade" on the steamboat, Wirt starts laughing. Elijah Wood moved away from the microphone and started laughing after recording the song, this is why his laugh isn't as clear as the rest of the dialogue. There is a video of this recording session in a behind the scenes video on Cartoon Network's YouTube channel.
Embouchure (also called "lipping") is a musical term that describes using your lips, tongue, facial muscles and teeth to play a woodwind instrument. In other words, everything you do apart from just blowing into the mouthpiece.