I spin the rotary dial to change volume but no luck. Used to work fine....Any suggestions?

There is a two way switch under the wheel that registers if you turn the wheel to the left or to the right. This switch might need some cleaning.

...and also, the optical sensor that gives the actual rotational signal.

If the MCP lights up when you turn the wheel, the switch is OK, but the optosensor is gone... if it doesn't wake up on the wheel alone, the switch is the probable culprit.

sounds like the optosensor...any way to manually control volume? also is there a cost effective way to fix the sensor?

So you have a Beosystem 5500? Unfortunately no way of controlling the volume without another remote... so in the meantime you should get yourself a Beolink 1000 or a Beo4!

Finding the spare part may be a bit of a problem, but replacing it won't be a big job to someone who knows what he's doing. Cleaning the switch would be a good idea for starters anyway, could be that it won't make continuous contact anymore while you turn the wheel.

Just to update progress on this. Ended up using a Logitech Harmony Remote 1000. Downloaded software to control 5500 and works well.