My old (~2004) iPod sounds significantly better than my iPhone 3GS, Samsung Nexus, or (current) Motorola Droid Razr MAXX. The cell phones were all relatively noisy. Of course the streaming services on the phones may have biased my opinion. Rhapsody, Pandora, etc., are all compressed whereas my iPod is mostly filled with Apple Lossless files. Still, I have some WAV files on my Razr and they still don't sound as good as anything on the iPod.
In fact, I'm planning to get another iPod while they still make them.
Bottom line: the only advantage a smartphone has over an iPod for music is the ability to get any music you want anywhere, which is nothing to sneeze at. Sound quality -wise though, there's no contest. Maybe the Galaxy 3 is an exception, but I doubt it. The iPod is still a Stereophile recommended component. No cell phone is.