Since I got an iPod for Christmas I've been using it for most of my listening. Same with the wife. This was great at work or out walking. In the car - well that was a different story.
I started with a Kensington FM modulator from Amazon for the wife. Decent sound but there were too many stations around here so static and interference was a problem. I kept looking around and ended up at my old standby from a long time ago - Crutchfield. A few minutes there and I had a Harman Kardon Drive + Play on the way. I added the in-line modulator to maximize quality. After spending a Saturday afternoon putting it in her van she's a happy camper. Sound quality is pretty good with near zero interference. The wired remote makes it easy to select music.
For my car I did something a little different. Back at Crutchfield I found the USA SPEC iPod® Interface. Another afternoon spent hooking it up to the stereo (hidden in the trunk) and running a cable to the dash where the actual interface resides (behind the existing stereo control) my iPod is accessible as if it were the factory CD changer. Very nice.
Both products and Crutchfield are highly recommended.