Using my iTrip with the Iphone... No problem, it will suggest that you go into Airplane mode, but you can select No.

Once your phone rings, it will inactive the Ipod function and your ringtone will start playing over the radio speakers, once you answer the call.. it will stop the FM transmission and use it as normal.

Call ends, and the ipod function activates automatically again.

But as always, sound quality is at a low.