Here's how I got the HEADPHONES working properly in Ubuntu 9.10 KARMIC Koala. My computer is a HP Pavilion DV6 1128-TX Notebook.

The problem was that whenever I plugged my earphones into the headphone jack while RUNNING Ubuntu, the internal speaker sound wouldn't mute, meaning that I had both speaker/earphone output.

So after re-installing Ubuntu, compiling the latest ALSA version, updating the system, getting needlessly angry at my laptop, I finally found out a work-around.

There is an application that you can use which controls the sound levels called alsamixer.

All you have to do is turn down (NOT mute!) the 'Speaker' channel to zero and turn up the 'Front' channel.

The only caveat here is that you cannot use GNOME's volume control to turn up/down the sound, otherwise you have to do this again. Instead you can use alsamixer to control the main volume.

I'm not sure if this will help ANYONE, but this is what worked for me.Apparently, this depends on the hardware in a particular system.  I have Ubuntu 9.10 installed on an HP Compaq d530 CMT tower PC and have not had the problem you experienced.  If I plug in headphones, the speakers automatically cutoff, and vice versa. 

But, THANKS for posting that info.  It may be helpful some Ubuntu users. Actually, now that I do remember using it on my now dead Compaq laptop (Yes I still have it), the speakers would mute normally.

So I guess it does have something to do with the hardware.