I haven't tried this yet but I'm going to monkey with this tonight.
I have also thought the ultimate portable audio/music device would be a Sirius receiver and an Ipod.
Well after reading a couple of other posts on this topic I can now hear Howard Stern live on my iPhone!
You need the following:
1) http://www.millardsoftware.com/uSirius (this runs on your local PC and connects over the internet to Sirius using your Sirius account).
The setup is pretty straight forward - just enter your Sirius account info and it will do everything else. Click on URLs to get the URLs for each Sirius channel you want.
2) Sign up with http://orb.com/ and install the local client on the same PC that you installed uSirius.
3) Set up Internet Radio Favorites on mycast.orb.com (cut/paste the URLs from uSirius for Howard 100, 101) for each Sirius channel you want.
4) Login to mycast.orb.com from Safari on your iPhone and select the favorite that you created. Listen away!
It works well over Wifi. However, I have to wait to go back to the states to see how well it will work over Edge on ATT as it's too expensive to use on Rogers, currently
Note there seems to be a bug, on the first connect from Safari, it will crash, just try again and it will stream quite well for a long time.
OH BTW live365 Internet channels also work in the same manner (Get the URL from iTunes get info after trying on your PC). iPhone also works well as a remote control for my SqueezeBox.