Is there any way to adjust the audio from the microphone so it doesnt distort which sound is too loud? for instance, I am a DJ and take video, the sound is distorted when I play the videos back because I am very close to a speaker which is loud.
Yes, but I didn't get the impression the DJ was wanting to get that involved. If he was, the D3100 seems an inappropriate choice from the outset.
This is an issue with DSLR video. The DSLR cameras need a variety of extra cost accessories to make professional quality videos.