iPod/iPhone Audio Quality

1. Larger ipods generally sound better than the smaller ones.
2. If you want to play via a stereo, then use a cable that will bypass the volume control and give you a straight line out.
3. And yess, higher bit rates are better, uncompressed is certainly really nice.
Art

I find the sound of the nano and shuffle on anything but rock and roll to be fatiguing. But the 80 gig classic with lossless sounds great to me on classical.

One key is that I use Westone 2's which are NOT hot in the treble, definitely offer a more natural treble. I had a chance to test a variety of high end in-ear phones at a show and I found several of the high end ones, which did sound wonderful to me, might not be the best match for a iPod in that they were too revealing in the treble. For example I felt that way about the Shure 420 and 530 (but not the sure 210 and 310). This is based on just a few minutes testing so take it with a grain of salt, but, I'd rephrase your question to be not just about the iPod itself, but about teh full package: iPod, earphones, choice of music, bit rate, etc.

Art