I know you can use the stock NAV screen to play DVD's, but has anyone found a way to use it as a user interface for controlling MP3 on an Ipod?

 

No, you can't use the touchscreen functionality of the screen for anything other than the stock nav system. You could try and device some way of displaying ipod playlists, data, etc on the screen and provide input via some other means (keypad, rotary ****, etc), but that's it.