Hi there! Thanks for using Audiobar.
Killing google ratings sucks, of course. If I really did kill your ranking, I am very sorry!
In general terms, Audiobar is about having the iframe for continuous playback, and then work towards making that iframe have as few side effects as possible.
For SEO, Audiobar puts your entire home page content within the iframe tags, so Google can access it without loading the iframe at all. The assumption being that that backup content would be treated equally.
It seemed to work well enough for me, but I didn't do a long term A/B test. Assuming what you say is correct, I might have been wrong. Or Google changed the way it works and made me wrong after the fact.
Since this is very important, I will change the SEO approach to simply disabling audiobar if the browser user agent is a known spider.
Until then, you could also try working around the issue by installing a Google Sitemap plugin.