If you want to stay with stock you have various opitions. At the cheaper end of the market you have an FM transmittor as mentioned above. Sound quality and retuning can be an issue with these. Also as above Mikey at site sponsors newministuff.com is the man to speak to.
Do you have Sat Nav? What about a CD Changer? As these effect what you can use.
Moving up a notch you have something like this (there are two versions depending on the age of your MINI). Allows the CD changer socket to be used to connect an AUX socket that plugs into the earphone socket of yor ipod.
NewMINIStuff.com
I ran one of these on my first MINI. If you don't want any control of your ipod through the car it's ideal. In fact my old one is in my garage at the moment, need to get it in the classifieds.
Then something like this
NewMINIStuff.com
But again control of the ipod is from the ipod itself. Title info is displayed on the ipod.
If you want to control the ipod through the MFSW and headunit in the car then you need a Gateway 100. This kit will give scrolling title display on CD Boost/hk stereos in 05/06 (& 07 cabriolet)& on cassette boost 03-06 Minis without Nav. You will also be able to browse through albums, artists, podcasts, audiobooks etc from the stereo controls on these cars.
Gateway 100
NewMINIStuff.com
If you think you may need to connect other types of mp3 player such as USB types as well as your ipod then there is the Gateway 300 (which is what I currently run). Allows connection via ipod, USB, headphone socket. Scrolling titles on the factory headunit, (05 & 06 models), and controlled through the MSFW and headunit. Great piece of kit.
Gateway 300
NewMINIStuff.com
Mikey runs a very professional set up that has a great reputation within the MINI community. Give him a go.