As Mikhail pointed out to me, when you have the headphones plugged in on the the MAcBook Pro in XP the built-in speakers still play sound. For a quick-fix to this problem intel has released a program that re-routes all the sound to the headphone jack. The only trade off is no built-in speaker functionality. I figured this works well as a temporary solution until bootcamp fixes this bug. If interested, here is the link to the fix.
Update: Mikhail just found a fix on the apple discusssion board that gets both the headphones and built-in speakers to work. Click here.