Matt,
You're in what some people call a vicious circle (or a vicious cycle--the rules on this one are relaxing). You feel nervous, so you crack your knuckles. Then you start worrying that you're bugging the people around you, and possibly setting yourself up for an old age plagued with bulgy knuckles and painful arthritis.
It's making me want to crack my knuckles out of sympathy.
I have good news and I have bad news.
The good news is that experts say that your habit doesn't cause arthritis. Nor does it enlarge joints or cause other significant musculoskeletal problems.
The sound you're hearing is actually two sounds (researchers put microphones up to knuckles to confirm this). The first sound happens when you pull your joint and create a bubble. The second sound is the bubble popping. Joints are where two separate bones meet. Ligaments and connective tissue hold them together, in kind of a bath of thick fluid. When you pull apart a joint, it creates extra space for the fluid. So, that first bubble forms. When the bubble appears, the liquid pushes back on the ligaments, snapping them back into place.