You're already convinced, what exactly are we supposed to do?
For me it would come down to whether or not you're tied to using the Ipod as your transport. If you're not, the Imod/dock treatment sounds like a shite load of money for a solution that limits what you can do with it. You can couple the pico to anything that can output usb audio, you can't do anything else with the Imod other than use it with the dock and you can't use the dock with anything other than the Imod.