the quality of sound from an Ipod to a stereo is vastly diminished compared with a CD. Even an Ipod vs a home computer playing MP3s shows a marked reduction in sound quality. Apple has invested a lot of effort into the design and ergonomics of the Ipod, not so much into fidelity.
At DJ nights, I can always tell when someone is using an Ipod, because the sound is so flat. If you want to play MP3s at home, you're better off playing them from your computer, either with a decent cord connection or Airtunes.