Yeah, I think thats where the bad sound quality stuff is coming from. There was a site that had a test between I think 4 different players and the iPod Mini was dead last, but that was through the headphone jack (which I seem to recall has been blamed on poor quality capacitors in the signal path or something).
Oh, anyone have a good recommendation for where to find a replacement battery? $10-20 shipped preferably, but I'd like a quality one that exceeds the stock one in capacity at least. The batteries are just plug in, right? No soldering necessary? Thats what scared me away from doing basically this same thing with the Rio Karma.
Maybe you can combine this with the DIY iMod thread. It may not be as good as the full iMod, but it should be one of the best flash players in existance possibly with the right modifications.
Quantifying Bass Performance in Digital Audio Players