Word handed done from a few iPod owners is that Apple's latest firmware update has rendered iPod playback on the 360 iffy. Tony sent us a tip stating that his 5G iPod is no longer recognized by his 360 after updating the firmware on his iPod. We've also heard from various iPod / 360 owners that, for some reason or another, their iPods either never worked (in the case of the the iPod Touch) or just quit working (2GB iPod Nano).

http://www.xbox360fanboy.com/2007/11...ng-on-the-360/