The latter.

So you want to use your iPod as a transport to get the mp3s to the empeg? That shouldn't be too difficult with the Axis microcomputer you linked. You'd just need to get it to be able to access the mp3s on the iPod, which, as you pointed out, is accessible as a filesystem, and then get the emplode protocol functioning to upload them to the empeg. The reference implementation might work without much change. If not, it'll be quite a bit more difficult, but hardly impossible.