Look, the standard stereo mini headphone port has three segments to it. Left, Right, and Ground. Standard stereo headphones have the same three segments.
If you want to add something else to this port, such as video or a microphone, you need another segment. Most miniDV camcorders have it so you can plug into a composite video source. The iPhone has it for the microphone (and I presume the little button to answer calls). These are hardwired to different parts on the board inside the phone.
You can't just use software to reroute hardwired controls. You are supposing that Apple should be abstracting every hardware item so that it gets connected to the OS, which then dispatches each signal to the correct place, in real time.
Well, they didn't do that because consumer OSes aren't realtime. They do what they can as fast as they can, but you can't get away with the latency that comes with routing every hardware connection through software first.
If you're suddenly not happy with your device because a new device has other features, then you've got to decide if you want to buy the new device and sell or otherwise discard your current one.
