Michael, Thanks for looking further into this question and keeping us updated with the progress!
I have a couple thoughts to share, the first being I completely agree with mitsu763, that this product should be looking to the future, not the past. Go with the 24/96 support if it comes down to supporting newer or older devices.
The next thing that comes to mind is what "cut-off" are we looking at for the iPods? As far as standard iPods (for example, Video 5th and 5.5 Generation, and 6/6.5/7 generation classics) There is no way to load high res files onto them anyway using the original iPod firmware. The maximum resolution you can sync to them is 24/48...so that is one thing to consider. The exception to this is if the ipod is running Rockbox, then high res files can be synced but as it was previously discussed, it is unlikely that the M8 would work with the "non-apple" firmware.
As far as the iPod touch, what generation would the cutoff be 3rd? 4th 5th? These players can accept 24/96 FLAC files and play through an app so maybe this is more the direction most users would go with 24/96 files
Personally, I have several iPods...My 5.5 Generation are "modded" so I probably wouldn't care if they worked with the M8. But if they did, I would only consider that a convenient bonus. I also have a Classic 7G and 5th Generation touch, the "newest" of each model. So I personally vote for 24/96 support, but then I do already have the newest iPods in hand....
Thanks again!