BMW iPod integration hissing?

[rbensmithX3]

Hello All,

Purchased 2005 Black/Terra X3 3.0i used last month. Was planning to get iPod integration, and it was already installed by the dealer (not advertised that way--bonus). However, with my G3 iPod, I can actually hear the hard drive spinning and there is static or a "hiss" in the background, especially noticeable during quiet songs.

Took it into the dealer last Saturday and the answer I received was kind of a round-a-bout:

1. Technically only compatible with G4-G6 ipods (Mini through Video)
2. Update the software on your ipod (Apple user--constantly updated)
3. No hissing noise with tested Nano--supposedly due to no hard drive
4. Any hiss is due to quality loss of CD to MP3 format

I guess I am supposed to believe that low quality is something to be expected from the first ipod to car integration, BMW. However, I bought a cheap ($119) integration for an Audi S4, installed it, and it sounds great with any ipod--better than CD quality.

Is it my iPod's fault, or BMW's fault? Anyone experiencing true clarity with the iPod integration for BMW?

Thanks--thanks for the great site, too!

Ben