Just restarted for the fourth time and it "magically" worked after doing nothing since the last restart. After unplugging headphones, the red digital audio light was still on (even though they were just normal headphones, unless that red light always goes on when something is plugged in them). I wonder that because the light no longer shines. I restarted the machine, reset PMU, reset PRAM, but it still thinks headphones are plugged in. It shows headphones in the output. I can't change the volume.... and that's about it. Still chimes at startup though, but that's only because they changed the startup chime to not go through headphones (which used to at least on PPC Macs).