That adaptor looks quite similar to mine - it fakes out the radio to make it think a CD changer is plugged in.

I rip my CDs to AAC format with iTunes, using a bit rate of 256. Initial rips were done at 128 due to capacity constraints at the time. I've been reripping the older CDs to 256, but that's a low priority project and isn't very far along.

Did find one thing I miss in CarTunes - can't rate the music. I have a playlist for unrated songs that I like to listen to periodically so I can set their ratings. Once set, the music follows my load/unload rules. The programmer has a facebook page for it, and has posted a screenshot with music ratings. He's planning a new release in a few weeks, hopefully that'll be one of the features in place.
http://www.facebook.com/CarTunesApp

ratings photo
http://www.facebook....2719392465&type=1