I experience the same and have done a fair amount of research finding that most others report the same... with little option/ability to improve.
I believe the GSII mic is optimized for close-in and lower volume speech and audio surroundings. I find the sound quality to be excellent in normal, low-noise environments. However, that good quality in low-noise settings comes at the price of completely over-modulated, blown-out audio when attempting to capture a vid clip of your favorite song at a concert.
Someone recommended I/you try to slightly "muffle" the mic opening with your finger when attempting to record in those environments, which may serve to dampen the audio. I haven't had the opportunity to try this out since it was recommended, but will report back with results when I do... and maybe someone here who's heading to a concert in the near future could try it out and report their results.
Meanwhile, my research has yet to uncover any "Magic Bullet" app and/or fix for this limitation of our phone.