strictly speaking i found a very easy way to get around the .aac protection.
im a mac user and use bias peak occasionally, i open a file in this, then go save as, save as mp3, and woohooo protection gone.
not something iv looked into but possibly putting a non European firmware on it might solve it
although the volume lock doesn't make it that quiet :-)
have you tried looking in the settings to turn off volume limiter? my ipod touch has this feature and im sure iv seen it when i had the old...
is it defiantly the jack, as these rarely break, it could be a dead wire in the headphones, this happened with my shure e2c headphones when i did a similar thing
boot off the mac os cd (hold down alt)
boot up, go to utilities menu, theres an option that says reset password, you select the volume the mac os installation is on and the user acc
theres an apple support essentials book avail, by peachpit
http://www.amazon.co.uk/Mac-Support-Essentials-Apple-Training/dp/0321489810/ref=sr_1_3?ie=UTF8&s=books&qid=1213631397&sr=8-3
this is the one you need to buy, but i dont think its called the adhst anymore