The documentation for libjpeg comes with the source-code. Since you haven't found it yet:
Download the source-code archive and open the file libjpeg.doc. It's a plain ASCII file, not a word document, so better open it in notepad or another ASCII editor.
There are some other .doc files as well. Most of them aren't that interesting though.
Unfortunately I cannot recommend any other library besides libjpeg. I tried a couple of alternatives, but Libjpeg always won. Is pretty easy to work with once you have the basics done. Also it's the most complete and most stable jpeg library out there.