If the key you have doesn't unlock the glove or boot then you have the mechanics key. Basically locks and ignition only with the limited key... the original owner probably lost the main key and never noticed teh difference.

Yes, I'm fairly sure volvo can make you a new key... no getting around the hefty price tag unfortunately (that I know of). IMHO, I don't think its really worth it since the glovebox lock isn't all that secure (I could rip it open with my bare hands if I wanted to).

good luck,
rt