Line-outs should be better than the headphone-outs. So the end results should be better this way using LOD cable yes..
Line out using that LOD cable completely bypass the Ipod internal amp and let you use whatever external one of choice.Just feeds a straight signal from source( Ipod ) unaltered by internal Ipod volume potentiometer/control and/or internal Ipod amp circuitry.
So long as the LOD cable has the small 1/8 inch end for plugging into the external amp yes definitely try that cable on the cheap, and keep your current setup.
That's why everyone uses the LOD anyhow. Play around with an upgrade to a better amp later.
Yes Cowons should be fine also, but I would say keep your current setup you are familiar with, unless it bugs you or something. Depends how fussy you want to get. Then also when you get bored you can always try the rockbox thing I have no idea about what products its compatible with though, and see how that improves it any.
Edited by nick n - 1/26/13 at 8:52pm