Audio input only sees aus audio output "external headphones"

I have a Elgato Chatlink cable that was working perfectly fine with my mac up until yesterday. Now the cable is only being seen as "output" "external headphones" instead of the Input it is. The Aux plug also has the 3 lines, which i have read in other forums is important so that the computer can recognise it is an input. Still, no luck. I tried with my other macbook and run into the same issue which is making me believe that something has changed with the software (rather than there being a hardware issue)

this is driving me mad, i've tried reinstalling everything, replugging every single cable, used different options for each cable and STILL it will not recognise the input as input.

Does anyone have the same issue or an idea as to how i could fix this?

Thank you