Is it possible To use my motorola droid As a speaker system for my portable dvd players through an audio jack
I doubt it.
The 1/8" jack on the Droid is AUDIO OUT. It sounds like you are trying to run AUDIO IN to the Droid.
There was a thread here yesterday with a neat little speaker that a few folks were using to listen to tunes on their Droids, you might see if you can find that.