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Ultra-cheap version: Buy a 2-way switch with 3 or more lines and solder yourself
Cheap Version: Get a cheap Audio source switch
The cool version (I would choose): Buy a 2 channel mixer and hook both machines into that... get one off ebay if you are savy. That way you can mix the two sources to your liking... let the computer play you some music while still being able to listen to the XBox sound effects all over one set of speakers...
I have hooked up my PS2 via optical cable to my G5, and use an Utility called "Line-In" to pass through the sound to my Soundsticks.... works fine, although you have to run the G5 to do that...