Thanks for the reply. I tried your suggestion. Under the "Audio Output" section, there is a channel master and CH 1 and CH 2. The master volume is not highlighted, and I can't adjust it from the zero output setting. I think this may be the problem.
I tried the rate/bit adjustments, but no setting made any difference. I'm still left with the only working audio output being the M-Audio device. I think I'll have to take this in to the Mac store and show them what's going on. They claim they have never heard of this before.
Jazzybs, that doesn't sound good at all. Please keep me informed with any updates. I'll also let you both know how my situation turns out.