Take a look at NAudio. this is a brilliant API for implementing audio based applications in .NET
Also consider this
how to Control "Windows XP Volume Control" with VC#
This might also help. This explains how to hook the Win32 API Multimedia library (winmm.dll) to control system volume
http://www.dreamincode.net/forums/topic/45693-controlling-sound-volume-in-c%23/