The part that makes it tough to believe is that it is hard for an admin to inflicted this diminished capacities on itself. Independently the scratched DVD is believable. If a kid was creating a context to solicit help bypassing parental controls it would go very much like this one.
One case that I didn't consider was that one of your kids' account is now the administrator. It is still the case that the admin locked you out. It is only that you don't know who the admin in.
Go to Applications > Utilities and open Terminal application.
At the prompt type:
ls -l /Users/
Should get something like
drwx .......... Shared
drwx .......... username1
drwx ........... username2
where Username are the names of the accounts on the machine. "Shared" isn't an account. For each of those names type
groups username1
where 'username1' is the user names. That will spit out a list of groups. If see something like 'admin' or 'lp_admin' then that account is an administrator account.
If there are no accounts that are a member of admin then that whole instance is screwed. Create a Lion / Mountain Lion / etc installer USB Flash drive with your other Mac and wipe this one out. Or create a rescue USB Flash drive and restore from a previous back-up (if have something like Time Machine snapshots from before this instanced was train wrecked. )
If one of your boys has an admin account then have him login and then take the computer away.
Turn off parental controls on your account ( Sys Prefs > Parental controls )
Turn your account back to an admin account. ( Sys Prefs > Accounts )
logout. Login to your account.
Turn off admin privileges for boys accounts
Turn on parental controls on those standard accounts.
Two other measures to consider.
1. Create an account just to be the administrator. Make that account have admin privs and re-downgrade your current account to just a standard user.
For day-to-day usage you would just have a normal account. So if you get up and walk away for a couple of hours or accidently let the boys use the account it isn't an admin account.
There is an addition burden that need to login to the admin account from time to time to run "Software update" and get new/updated applications.
2. If your boys escalated their accounts to admin status without your knowledge then probably should consider the following
http://www.opendns.com/home-solutions/parental-controls/
Basically you can set your home router and personal computers so that they use this DNS server service. There is a free and "for pay" parental control settings. iPod Touches, hand held games , game box, etc. all get onto the internet these days. This approach blocks all the devices using the service .
You can also cut off proxy sites if that is an issue.