Sorry... but yes, that is what a shorting plug is... the inner lead attached to ground.
You might try the shorting plug on the right jack... meaning to the right of the left one that controls the distortion. The right one should control the boost and when you plug in the shorting plug, the volume should drop.
I would open up the amp to check out the distortion. It is probably some crud built up on the RCA jack... or possibly the lead from the preamp board to the jack has worked itself loose - the connections at the preamp board are all made with clips that slide over lugs.