I just went through the exact same experience. I noticed air bubbles coming out of the coupler after every pour, that would create a burst of air from the faucet every time I would try to pour a pint. And as we all know..., once you have foam in the pint it is hard to stop it. Upon inspection of the keg I found a similar problem to yours.

With advice from this forum I attempted to return my keg as faulty. If your retailer is good they should trade it out for you. Mine (Lee's Discount Liquor, Las Vegas) told me that it was not their problem, and that once I left the store they would not take the product back under any circumstance. At least I have a good local distributor that was willing to help a consumer out!!
Yours looks very similar to mine. Once I got the new keg hooked up, I had no problems and no air bubbles in the line.
On a side note..., can anyone tell me how this happens? The replacement keg I received, looks like a notch in black ring is beginning to form. However it is not big enough to make a difference yet!