P.M.
This could be reflux, and if nothing else calms your baby during feedings, it would be worth checking out, especially if she doesn't gain weight. You do suggest that she's okay when you lay her down, though, and this would tend to make reflux worse, not relieve it.
And I'm interested in her ability to eat with the noise of the blow dryer, because this is mentioned in THE HAPPIEST BABY ON THE BLOCK by Dr. Harvey Karp. He hypothesizes a "fourth trimester," during which babies are still developing neurologically outside the womb. What he describes seems to match your situation perfectly.
While less sensitive infants may do just fine, adjusting to the quiet outside world is a big challenge for many babies, according to the doctor. They have lost the sound, motion, and snug surroundings they were accustomed to before birth. Some babies have a strong startle (Moro) response. And many also are disturbed by their own NORMAL abdominal sensations as their bodies learn to digest food, which they didn't have to do before birth. These babies may cry, squirm, and arch their backs when trying to feed. Reactions typically start about 2 weeks after birth, get worse until the 6 week, and then gradually fade by the 12th week.
Dr. Karp's suggestions aim to stimulate a natural calming reflex. The book is a little "precious" and wordy, but you can skim it for his theories and main ideas, which can be helpful any time a baby is fussy, including feedings:
1. White noise, by shushing, a hair dryer or vacuum cleaner, helps calm many babies. The noise they heard inside the womb was a constant and LOUD whooshing and gurgling. And they don't hear very well for the first months after birth, so loud is necessary.
2. Hold the baby on her side, not her back, during feedings. She'll swallow more easily and gulp less air. If you can keep her tummy against yours, she may find this comforting (though if she's already struggling, she may need the white noise for awhile first to calm her). The falling reflex is more likely when the baby is on its back. Side or stomach carrying may be more calming for babies at other times, too. The book illustrates good techniques.
3. Jiggling and vigorous swinging comfort cranky babies. The doctor also suggests thumping your heels with the baby on your lap. It would probably be hard to incorporate these motions while actually feeding, I think, unless maybe you're sitting in a rocking chair. But every baby I have ever soothed responded to my hugging them firmly against my body while I jog on my heels at about the rate of my heartbeat. Firm thumps on their little diapered bottoms also seemed to help.)
4. If the baby is still not comforted, swaddle her snugly, even during feeding. The book illustrates a specific technique, and explains why this works even for babies who seem to resist it at the beginning (contrary to what I think would be helpful, but I'd want to find out if it works).
5. The book has other tips, including avoiding caffeine if you're breast feeding.
I'd really love it if you would do a follow-up "So What Happened?" report if these ideas help, R., since this is an incredibly common problem for young parents. If the doctor's suggestions work, I'd like to pass them on to other moms. My best to you and your family.