I bought an FM transmitter from C. Crane (ccraneco.com) and it is powerful enough to broadcast 20 feet horizontally and up through the floor of my basement into my living room. Actually, it could go farther.
Cost $60 (orphan department, returned merchandise) or $70 new. You get what you pay for. No distortion (if you watch out for the red clipping indicator on the unit) and no hum. I use it to broadcast audio streaming from my PC to my home stereo. It plugs into the audio card or speaker mini jack, but it would work the same way with an iPod. You probably would need a car adaptor kit for use with a car radio.
Hey, I recently bought an Apple iPod with Dock Connector, but I need a good FM Transmitter. I heard Belkins has a little trouble with volume and fidelity. What's the best in audio quality, that's around fifty bucks?