I use one called an iRock. It's okay, but not great. It's limited to one of four frequencies. The problem is, if there are other stations on or near those frequency, it gets interference. I use it when I drive between LA and SF. I wind up having to switch channels fairly frequently, and sometimes I can't use it at all. When it works, however, it works very well -- good sound quality and an easy way to listen to my iPod in a rental car.

When I drive my own car which doesn't have an iPod adapter, I use a cassette adapter for the iPod which, of course, doesn't have any of the drawbacks of the FM transmitter.