Forget the FM transmitters, they SUCK!!!  The cassette adapters are slightly better but they do work.  You'll still need a separate charger.

The best bet is to swap out you radio for something that has an iPod interface built in.  I've seen some as low as $150 range.  There are two types.  The one that connects a wire to your earphone jack ad all that does is just pipe the music directly through your radio so all iPod functions are still controlled through you iPod.  They require a separate charger.  The good thing about these is that you can hook up ANY type of MP3 device to them.

Then there are the ones that have an actual iPod interface (I have one of these for my boat and it rocks).  Those will ususally have the iPod controls built into the deck and will allow you to select music etc using your radio controls and they also charge your iPod while you drive.

+1 to everything Wambli said.  I put an Alpine head unit in my truck shortly after I got it, and I haven't looked back.  It has XM radio built in, HD Radio capabilities, worked with my controls already mounted on the steering wheel, and the option to control an iPod.  I ended up getting a Nano a few months after I got the truck, and I spent around $20-30 on a cable that plugged into the back of the unit.  I had to do a little cutting on the sleeve that my unit is mounted in to have a good spot to run the wire, but it plugs into the iPod, the player detects it, and the controls are on the unit to let you select the artist/song/playlist and all of that.  Most of the time I put mine on all artists and songs and on shuffle, unless I'm wanting to listen to a certain thing.  Another thing to consider is that Apple has changed the hardware on the newer models (2008 and on) to charge differently than previous models.  I had to buy a small adaptor to plug into the end of my cable to get it to charge my newer ones.  It would play just fine, but not charge it at the same time.  Learned that after a day or two when the battery was dead. 

Here's my set-up, with the addition of an adapter sleeve to mount the unit in since it isn't a standard opening on the Jeep.  It also has a small pocket beneath the unit where I cut a slot to pass the wire through for the iPod, and it sits in the pocket out of sight when I have it plugged in.  Sure beats having to have a separate mount for it or put it in the glove box.  My iPod Touch also fits in there nicely, and it is only slightly thinner than your iPhone.

yeah I know fm transmiters arn't the best, but the one on my sirius radio seems to work fine 99% of the time.  I'm hoping to get rid of it since they keep raising the prices and now since I have the ipod I won't be stuck listening to the crap that passes for local radio these days. 

Unfortunatly I have not budgeted for a new stereo (well really it means less "fun money" for things that go bang) and don't think i'd want one.  My Volvo T5 is 8 years old but has what was a fairly high end stereo from the factory.  It also appears to be set up to make it about as hard as possible to steal or replace with an aftermarket system (if you don't do all the right things when taking out the old system it will imobilize the car!).  While the deck wouldn't cost that much getting it installed and not looking like someone just took a baseball bat to my console and stuck in a new system probably won't be.  Also volvo has some crazy wiring stuff that requires you to buy expensive adapters. 

It looks like there are some kits to add ipod connectivity to the factory stereo but they're not much cheaper or easier to install than a full replacement deck. 

I was just thinking about something cheap and easy like this....

http://www.amazon.com/gp/product/B001QFXDA2/ref=s9_simx_gw_s0_p23_i1?pf_...

Then go that route.  In my old Cherokee, I had an XM sort of mounted like that, and it played through the radio.  I got tired of it just lying in my console/dash, and I eventually did some real work to it.  Bought a mount that actually screwed into the plate behind the dash, and hard-wired it for power, and this other contraption that attached in-line with the wire that ran from the vehicle's antenna into the back of the cd player.  Since it basically took over that FM frequency when it was on, and disabled the antenna from picking up anything, the sound was great.  But I never really had any trouble with interference before that.  It just came with the mounting kit, so I used it. 

Just make sure that it will charge the thing as well.  Like I said earlier, my older cable wouldn't support charging on the newer models, but the new accessories probably do.  I just had to get an adapter in order to charge it. 

The problem with the FM transmitter type is that if you travel, your clear FM channel will only stay clear for a short time, then a distant station gets stronger and you're frantically trying to tune a free one. That, and every time a truck goes by, you get treated to Slim Whitman. Then an Escalade will draw near, and your kids get a little Gangster Rap to think about.

I understand.  My original sirius radio had a built in FM transmitter that worke fairly well but then again all I ever listened to was the comedy channels and the NRA channel.  I bought a FM thingy for my Zune and it SUCKED BIG TIME...  That's the one that soured me to those type setups.  Best Buys has a setup that actually taps your antena wire that is supposed to work fairly well.

Thanks, I may check into that.  As you said the transmitters can definitely be hit and miss.

Definitley dont go for a transmitter. I got a fully integrated kit from http://www.ipodcarkitdirect.co.uk it installes behind the stereo and the iPod can be controlled through the steering wheel. Unless you get an adapter you cant to with the aftermarket stereos. 

it was only £100 which at the time was $130 definately worth it in my opinion

Good look with the hunting

What did you end up going with?  We just picked ours up yesterday, and while I already have the setup in the car for mine, the wife mentioned wanting a car charger, and I think she'd probably like one she could dock it in and also listen to music.  She's never really been the ipod type, but I think with it built into her phone, she will start using it and enjoy it.

I havn't bought anything yet.  Looked at best buy and walmart and didn't see anything worth the money.  I haven't canceled my sirius yet so I'm not in a huge hurry (think i'm still paid for 2-3 more months on my 6 month plan)

  I forget which make mine is but it's one the wife got at Target.  $60 or so I think.  Fits any of the ipods via interchangeable "arms" which hold it in it's cradle and connector.  Functions as a transmitter but you can choose whichever frequency you want or have it search for the best one rather than being stuck on just one or two frequencies.  Works really well.  I do know some set-ups do not work with all ipod models.  Some will not charge the Touch model or the iPhone.  

One of the joys of living in a small country is that the Airwaves are not too cluttered.

I use an itrip all the time in both the house, the charter boat, the jeep and at work. 

Never had a problem with it and have been running this model for  3yrs now. What did annoy me was that when my earlier 40gb Ipod crashed under warranty, they replaced it with a 60gb one. None of the accessories I already had would fit and I had to buy new adapters.

just another way for the geeks to squeeze more money out of you I guess