The FM transmitter solution works, but can be a bit unreliable as you drive around, moving through areas with different interference etc. The transmitter works by sending the radio signal out at low power on a particular frequency, so if there's something bigger (like a real radio station) broadcasting on the same frequency you'll hear that instead.
I have a transmitter that can be battery-powered or plugged into the cigar lighter - it only works satisfactorily when plugged in.
The quality of the sound also depends on how good the FM reception is in your car.
As for the power issue, you can get splitters for the standard car cigar lighter; search Amazon for "car power splitter" for examples, such as:
http://www.amazon.com/gp/aw/d/B001JPRLPM/ref=mp_s_a_5?qid=1293873275&sr=8-5
If the transmitter works for you in your car and your location, and you can put up with the wires dangling around the car, then it's an ok (not great) solution. Another simple method would be to replace your stock car stereo with one that has a 3.5mm AUX input, and plug the phone straight in.