There were hacks and exploits in the game, but they were typically very rare after the patches.
The trouble is that there are indeed some MODS that are widely used that have BACKDOORS built into them and major exploits, that allow people to generally raise hell if they know the right buttons to press. Was this a mod server or unmodded?
If it was running one of the many admin mods out there I'd dismiss this out of hand as the result of some kind of mod glitch or backdoor. That doesn't rule out the possibility, but it certainly raises some giant red flags!
Anyway melord, it sounds like you're very angry about this, but please don't assume that we're cheaters if we don't immediately agree with you!
I know that certain cheats do exist, such as wallhacks and aimbots, but they are rare, because they don't confer much of an advantage by the nature of the game. The other deal is scripting, which some consider to be cheating, others don't. There's examples of some weirdness like moves with "broken" animations that kill in one hit and are unblockable, and "wiggling" moves that do way more damage than they're supposed to normally, and the "debug" animations being available for incorrectly compiled mods.
Supposedly there was some glitch in JA wherein a person could overload and crash a server somehow. But I don't know how to do any of these. You'd have to get into real specifics here, for us to have any idea what's going on.
A lot of weird glitches exist in the game, but not all of them can be used to take advantage and ruin the game consistently on purpose... and since LucasArts has not given Raven Software permission to release anymore patches for the game, any fixes will have to go through modders. But it seems the serious coders have all moved onto JA or other games, but I could be wrong about that...