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I know on my non iDrive model with Logic7 I can increase the auxillary volume on the head unit which improved the quality. I am using a premium cable and I don't really notice much difference between the 192kbps tracks on my iPod and a CD. That's using the lineout port on the bottom of the iPod - the standard headphone jack on the top of the iPod is not the best way to get the sound into your car and will sound poor in comparison.
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