Did you not consider hiring a lawyer? I know they cost money, but this sounds like it was a major investment of time for you. If you want it to ever be a successful business, you'd eventually have to put money into it. How did you pay for hosting?
There's a big difference between a 15 year old coming up with $3/month for hosting, and coming up with $300/hour to be told you misunderstood the DMCA and aren't protected.
