Here's the skinny on this. And I wish I knew about this earlier before I preordered my iPhone 5.
After the Keynote, I sent an email to Tim Cook. While I did not get an email back, they did call me and I just spoke with a representative. He gave me good news and bad news.
Good news: the adaptor will allow you to hook your phone up to your 30-pin connector to your car and your music will play out through the speakers.
Bad news: you will no longer be able to navigate through your songs and play them via the screen on your dashboard.
I hope this has clarified this issue for most. I see this as bad news, but at least something I can live with. That said, I probably would have held off on preordering.
Thats interesting. I guess that means it won't disable the on screen controls on the iPhone. If so, this is great news for me because I hate that disables the controls.