I've been grappling with this one too, aswell as an iPhone kit.
Not sure of the age of yours but my scenario is a new S3 with Concert II HU but no CDC or iPod kit. The car I've ordered is already built so I couldn't add the iPod kit (£180) to the order. I asked the Salesman to fit one and he quoted £500 to get one fitted by a local firm saying that Audi don't do a retrofit kit.
After lots of digging around it seems that the best aftermarket one used to be the Denison kit but it no longer works with the latest HUs. However, Audi sell the iPod kit, as per the factory option, for £100. My local dealer says it's no problem to fit and with a bit of luck the car will come pre-wired for a CDC which is where the kit plugs in (replacing your CDC if you have one), if not you just pop the HU out and it plugs in the back of it. I went back to the parts dept of the supplying dealer and when I told them about the part and they brought it up on the screen..you've never seen such baffled faces. After lots of head scratching and sucking of teeth they refused to sell it to me because they'd never seen one before and didn't know how much work was involved in fitting it. They doubted that it would be a user fit part and estimated half a days labour to fit it!
I know the Audi iPod kit isn't that great and doesn't give track names etc but it does hide the iPod, charge it and you do get some control from the steering wheel which is fine for me. With a small convertor(to convert the charge voltage) I can plug in the iPhone to charge it, use that for music and use it via Bluetooth as a phone. I would have liked the armrest fitting for the iPhone to link with external aerial but, again, mine isn't pre-wired and this definitely isn't a retrofit job, so I'll make do.
Hope this helps and I'll let you know the outcome in 2 weeks.
