Checking on digital output zone2 .... Here is the 5003 manual online:
http://us.marantz.com/SR5003_U_EN.pdf
page 3 "Zone B digital optical output." second column
Any AVR can do ipod playback you need an inexpensive mini audio to two RCA cable like this one for only $0.66 yess 66 cents!
http://www.monoprice.com/products/product.asp?c_id=102&cp_id=10218&cs_id=1021804&p_id=665&seq=1&format=2
Plug the audio into the ipod and the RCA into the right (red)/ left (white audio of any unused device, example CD.
Ihave the SR8002 and it is very beefy, yet

I hvae it running behind a closed front door audio cabinet I left the back open and left 4 inches above. After running for several hours it is barely warm; yhou can put you habd on it and leave it without burning or pain. Marantz is well built and I would expect the SR5003 to be well built and beef also.
Oh yeah ... looking at the manual ...the new 5003 will upconvert to 1080p, mine will only unconvert to 480p even though ii supports switch and inputs for 1080p. The upconvert i have is VHS and that isn't really used; just connected and tested.
Good Luck!
MidCow2