I know that Apple limits the rate at which you can stream, but I would vote for a pseudo-stream option where I either load up my iPhone ahead of time (a la iTunes) or let it buffer for a while to accomplish the same result. Then be able to output at something like VBR 0. I got a Squeezebox because I wanted to improve the fidelity for home listening, but for car or at work, I either need to sacrifice audio quality or integrated playlist and statistics management. I don't need to listen to lossless in the car (well, unless I'm parked), but would like better than 128k.
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