I'm not a Pro at this, but I have built an amature radio before, and from that experience, I don't think it's possible for software emulation. Other than lacking an antenna, which can't be put onto headphones (headphone jack has 3 'pins' if you will, a left audio channel, right audio channel, and ground) since that's for output only, the iPod would also need a really good filter/tuner and apmlifier at least...which should be achieved through some analog components.
I've also built an MP3 player before, all it needs are the following...HD DMA (direct memory access) to RAM, which may be DMA'd to a shift register chip connected to an MP3 decoder, or simply read by the CPU and outputted to the MP3 decoder chip. Depending on the MP3 decoder chip, you may or may not need a DAC (digital to analog converter) and an audio amplifier. Some MP3 decoders has DAC and audio amp built-in, you just need to connect some analog parts to it. (there are a few other chips necessary, such as a MUX for RAM, and control logic for CAS/RAS, but not part of the "big picture")
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