You can also try putting it under a warm (not hot!!) lamp. Keep a careful eye to insure that the phone never gets more than warm to the touch. Putting it about a foot and a half from an incandescent lamp is a good starting point.
As Varjak said, the drying process can take several *days*.
I have successfully recovered computers, iPods and phones in this way. Unfortunately, in one case i "recovered" an iPhone (in that it worked fine again), but simultaneously also damaged the screen (permanent black spot) by putting it too close to the lamp, so be careful.
The telltale in the jack doesn't tell you whether it's been damaged. It just tell you it's been in water (which you already knew). Its primary purpose is to tell Apple the warrantee has been voided.