So this is my first attempt at doing something like this.
It sort of worked, the main problem was when i powered it on there was so much noise coming out of the speakers.
Did a little googling and found out that if i power the amp chip and the bt source from the same source, i end up with a ground loop.
Here's a simplified diagram of the current setup:

Anyone have any thoughts on how to fix a ground loop without using 2 individual dc sockets for powering?

 

Are the signal "Grnd" terminals actually directly connected to the -ve supply terminals inside each device? Test, or look at the data sheet to make sure. If they are, just use one 7805 regulator and connect the BT receiver to the amplifier with only 4 wires:

• Grnd
• Left audio
• Right audio
• Power +5V

It might be a good idea to add a filter in the +ve supply between the amplifier and the BT receiver. This could be as simple as a small inductor. Try without first.
If the "Grnd" terminals are not connected to power -ve, things could get more complicated!

 

Are the signal "Grnd" terminals actually directly connected to the -ve supply terminals inside each device? Test, or look at the data sheet to make sure. If they are, just use one 7805 regulator and connect the BT receiver to the amplifier with only 4 wires:

• Grnd
• Left audio
• Right audio
• Power +5V

It might be a good idea to add a filter in the +ve supply between the amplifier and the BT receiver. This could be as simple as a small inductor. Try without first.
If the "Grnd" terminals are not connected to power -ve, things could get more complicated!

Regarding your first suggestion...here's pic of the amp chip. I think the grnd and the -ve supply aren't connected:

 

Separate Grounds for DC and Signal.

 

Ok, i noticed that Grnd output of the bt/mp3 module is acutally an AGND. Should I not have soldered that to the amp chip?

 

Ok, i noticed that Grnd output of the bt/mp3 module is acutally an AGND. Should I not have soldered that to the amp chip?

The BT output ground goes to pins 9,11 on the Amplifier.