Hey pupton,
In reverse order ... does the cable work with other audio recording apps, like the built-in voice recorder? I'm guessing not, but try it. If not, then I can think of two possibilities:
1) lint is jammed up inside the jack. We've hit this a few times, and it can be very difficult to get out.
2) The plug is not making complete contact inside the jack. Unfortunately, we've heard of this a few times, also. Something about the exact sizing of the plug on some iPhones.
Your iPad 2 issue seems unusual. It is fairly common to get feedback with headphones when using very high gain distortion with listening levels because of the circuits inside the device. But into an amp the output should be a high enough impedance to not be a problem.
Do you have any way to test what connections are being made inside your converter, like with an ohmmeter? If so, can you tell me what is connected to what? Like if one of the headphone output lines was being connector to ground (the larger conductor on the plug to the amp), then I could imagine that being a problem.