I have an iPOD it is awesome.. Whatever you do not waste your money on a wireless FM transmitter.. It does not work for sh%t.. Right now I am just using headphones in the car.. There are options to hardwire it into the FM reciver on the radio. I am going to look into that.. Or if your radio ( I do not drive a GTO right now ) has AUX input it would be best to wire into that for the best sound.
I have never cracked open the dash on my goat. I have read in various other posts that there is not an aux inout to our head unit. A few people did put their heads together a while back and figure out how to hook up a cell phone to the stereo (apparently its designed to accept it) Perhaps this could be of some help to you?
If you dont care too much for quality, FM'ing is easy and an iPod would surely work. If you really want MP3 in your car & you want good sound quality, try looking at some HU's that can play mp3/wma off CD or DVD.
If you have some $$ to spend, the 10gig kenwood keg can be found for ~$300.00 new and can be used w/ most kenwood HU's. Phatnoise (add a dot com) sells the same unit as well, but not kenwood specific.
If you do go with an FM transmitter the itrip by Griffin Technology is a great one. I have it and it works fine. Also now they have another device called a RoadTrip that I have never seen but it looks cool. Check it out Griffin Technology. Or try the ipod accesories page here.
The fm transmitters are not that good. If you don't have the RCA hookups(with a stock radio you don't), you could also get a FM modulator. It still uses FM frequency but the antenna plugs into the box to get you a better signal..