Well, now that I've had a day or two away I fell a little better about things.
To start with, I've solved my no-engine sound problem. I have a Turtle Beach Santa Cruz with a set of 4.1 Atlec Lansing speakers. After tweaking a bunch of stuff trying to get the sound back, I found that if I switch the sound card from 4 speaker to 2 speaker setup, I now get engine sounds! So there's one for the buglist... :D
Next up, upgrade my ATI drivers to 3.0 to see what that does. I usually stay on top of my vid drivers but just haven't had the time to do the new Catalyst 3.0 install. I'll report my finding...
After installing the 3.0's, MP on HL seems much more stable! I actually played a game for almost 15 minutes... :D Maybe there's some hope yet...