Thanks to rabies in the IRC channel, I found out why my Mplayer playback was failing, the default codec doesn't work on OZ3.5.4RC/Collie...
Opening audio decoder: [mp3lib] MPEG layer-2, layer-3
AUDIO: 44100 Hz, 2 ch, 16 bit (0x10), ratio: 20000->176400 (160.0 kbit)
Selected audio codec: [mp3] afm:mp3lib (mp3lib MPEG layer-2, layer-3)
^^^ - that's the default non-working codec...
Using:
mplayer -ac mad SONG_or_STREAM
forces the codec over to libmad:
Forced audio codec: mad
Opening audio decoder: [libmad] libmad mpeg audio decoder
AUDIO: 44100 Hz, 2 ch, 16 bit (0x10), ratio: 20000->176400 (160.0 kbit)
Selected audio codec: [mad] afm:libmad (libMAD MPEG layer 1-2-3)
which plays back local MP3s and remote shoutcast streams without any skipping.
I can control the volume using / (down),* (up), m (mute) ... so I'm pretty happy with this solution for now.