You can keep your I-pod.
I've used MD for the last for years, recording my band, recording tracks to take to a studio, recording music to listen to, recording sound fx. I can't imagine doing anything like that with an I-pod.
If my mate has something on MD for me, I just take the disc and whack it in my machine. Couldn't do that with an I-pod.
'Could I just just borrow your $400 I-pod while I copy that audio?...'
...
Also, the I-pod is an MP3 player, so the data compression is going to be greater, therefore, more whistley, artifact-laden audio. Yuck. I'm not denying MD uses 'preceptual coding', but it's a lot less compressed than MP3.
You say MD is on the way out, and I know at least two friends at the moment who are in the process of buying units.