From your description, it sounds like the 1/8" plug that goes to the handsfree speaker isn't the same kind of output as the empeg's aux-in is expecting.

Or, as you already posited, there is a possibility that the aux-in of the empeg is malfunctioning. But I think it's more likely the first problem.

Just because it's a 1/8" jack doesn't mean it's ordinary stereo headphone output. Maybe it's something else, that just happens to use a 1/8" jack.