I have something called an iO Play.

It is wired in to the back of the stereo, and has a bluetooth module.

My Iphone then has a bluetooth adapter, and it streams music to the stereo, and is controlled via a small controller on the dash.

Kit has a microphone and doubles up as a handsfree kit:

http://www.my-io.com/Products/iOPLAY.aspx

£80 from Ebay.