Audiobooks have been moved into iBooks.
Chapters are there but chapter titles are not (i.e. all Chapters just say Track 1, Track 2, etc.)
Thanks for your reply...and good news even though I can not think of any reason why apple seems to be eager to screw up the fun in Audiobooks (which was awesome in the past...pre disfunctional chapters) after all, the single,file with chapter infos (and even separate chapter pics) was one reason that brought the private me to the mac...ah well, maybe next update...