The first thing I think when I read your question is that you have a pretty good grasp of javascript but seem to think there is some sort of "plugin system" for jQuery. Truth is, there is a very nice way to develop your own functions and extend jQuery (as you mention $.fn.), but after that it's the wild wild west.
I have two suggestions for you. The first is to get the UN-minified version of whatever autocomplete plugin you have gotten your hands on and invest the hour or so it should take (provided it's properly commented/designed) to look at what it does. There will almost certainly be sections that deal with "keyup()" and ".click()" that should be pretty clear as to their purpose.
Many plugins include a way to add your own callback handler during certain events (i.e. a value is selected). I have been using this one lately -
http://www.devbridge.com/projects/autocomplete/jquery/. It has an onSelect() method that you can assign a function to. From there, you can manipulate the rest of your DOM depending on the value the user selects.
