I think quitting now would have a detrimental effect on your college course. Job hunting is a time-consuming pain in the arse, remember ? so unless you have something else lined up or can last unemployed until the end of your course, I wouldn't walk.

Can you by-pass your line-manager seeing as he's off this week? I know that's usually bad form but it seems urgent to me that you let those above know your thoughts. I don't know these people obviously, but it seems to me you have the interests of the company at heart here and I can't see how they would be offended if you skipped a little bit of protocol this once.