People have been plugging their iPods into their cars almost since their introduction. I had a headphone-to-cassette adapter back in the day. How glorious!
Now, BMW has announced that their cars will take advantage of "iPod Out," a new feature of iOS 4. Essentially, it allows a very iPod-like UI to appear on the car's in-dash display, making navigation, playback, etc. instantly familiar to the iPod owner. No more learning the car manufacturer's UI vs. the iPod's. BMW's solution will also add support for genius playlists.
Now don't go rushing out to the dealer just yet. BMW expects to have this feature in all of their cars (Minis, too) by next year. Until then, we'll just have to make do.
At least I still have my cassette adapter.