I was having the same problem until a few minutes ago.
KDE uses Arts as a sound server and it locks the soundcard - so nothing can make sound while arts is on it, and arts can't when something else is on it.
select / install the arts output plugin for XMMS [not .6 as that crashes XMMS, i use .7something]
now i have GAIM sounds, email sounds, and everything - concurrently!
i am new at this, but i guess if you use KDE it is best to have all apps use Arts for sound output if possible. just my clueless impression.