The LED's pulsate if they're hooked up to the headphone amp power supply? While that may be cool that shows some pretty poor design on Apple's part. If the voltage is dropping as the load increases it means there's very little, if any power regulation going on there. Shame on you Apple.

On the other hand it should look pretty bitchin'. One of my few praises of the iPod range is their ubiquity meaning compatible accessories everywhere and their hackabaility.