Too bad Christmas is long past, because this little gadget would have been on my list!
I've seen a few iPod mics over the years come and go, but none were designed with music recording in mind.  I haven't gotten my hands on this thing yet, but I am sure with Blue's pedigree it's gotta at least sound pretty good.  I've got an iPod Nano 2G, which is the least expensive iPod that it will work with, so I'm primed for a test.  It's even got a speaker for quick playback checks. 
Now if you can actually manage to record a useable voice over audtiion with this, that'd be really something!  
Go read all the spec's at the Blue Mikey website.