Why??? AHP isn't a sandboxed app (which would mean functionallity would have to be removed) it SUPPORTS hijacking FROM sandboxed apps - which is more functionality.
There is the stripped down piezo app which is sandboxed and available in the app store for those who prefer.

I've not played with GB, so I'm not sure if it does any of the following that I'm about to describe. But I do know that AHP allows you to customize effects with the recording. I can apply audio unit and VST plug-ins as part of my recording. I can set AHP to send the recordings I make to specific folders for specific programs (e.g., send any recording I make from Safari to a "Safari recordings" folder that I create). I can be recording one program while listening to another. There are a host of features in AHP that are quite nuanced.

^ Quite right. Audio Hijack does considerably more than just capture all system audio output, which is the only thing you could do with a cable (and even then it would be inconvenient, especially if you have to unplug a set of headphones or speakers first, not to mention the fact that you're degrading the quality of the signal by passing it through a DAC, an analog cable, and then resampling it with an ADC).

More to the point, what you usually want to do is capture audio from a specific application, so you don't accidentally record alert sounds and other unwanted noises.

Really, your $3 solution gives you exactly what you paid for: a cheap, inelegant and inconvenient solution, with none of the other features that make Audio Hijack great. It's like saying "why buy a car when you can get a pair of rollerblades for much cheaper?"

Does the honourable MacUpdate member acknowledge a difference between digital and analog?
Is the honourable member aware that recording the analog output of the headphone jack via the mic/line-in jack involves a totally unnecessary and deleterious double D/A and A/D conversion?
Is the honourable member aware that most Macs can output and record an unadulterated digital signal via TOSlink optical connexion?
Does the honourable member realise that, if a physical loop were necessary — and it is not — a digital loop would be infinitely preferable?
Does the honourable member realise that the advice he proffers is unsound?

"This is a known issue. Due to limitations in OS X and some hardware, AHP currently needs to prevent screen sleep to ensure proper recording. If it's possible with your computer and screen, you may be able to dim the screen manually while you're recording, although this is certainly not ideal."

Quote from:

http://www.rogueamoeba.com/forum/ubb/Forum2/HTML/000950.html

I fully understand where you are coming from, I don't like knowing that my PM with a 23" Apple screen is always "on" when I'm at work and my system is recording internet radio shows.

Though now with my mini I have a ViewSonic monitor that can be turned off independent of the Mac.

If you're at work the whole day, why not just unplug the monitor?

Ferruccio Busoni:

My 23" Apple display on my PM G5 is the old ADC style (plastic bezel), it doesn't have an independent power plug...

For those using Audio Hijack Pro, who have the plastic bezel style Apple LCDs or have a built in display (iMacs, MacBook / Pro), can't "turn off" their screen. However, MacBook / Pro can dim their LCD so that the backlight isn't active.

I use my Intel Mac mini connected to a ViewSonic monitor to record online radio shows when I'm at work, because I can manually turn off the LCD, something I can't do with my old style Apple 23".

You can record one side of iChat (the received side), not the sending side.

To record both sides, stay tuned...