I have xm in the car, and a sirius boombox in the house, and just picked up the XM mp3i portable receiver/mp3 player for $129 from XM plus monthly fee(you can always bargain with them!). It works great, gets great receiption, and you can grab a microSD card (got a 16gig from futureshop for $30) and load it up with mp3's for when you can't get reception, which is rare (it's my backup for the subway). Great lil unit, though the battery life is only 4 hours with satellite radio, 10 for mp3s.
Sirius has a beautiful portable unit, the stilleto2, complete with wifi, and the battery life is longer, but it retails for closer to $300.
Haven't listened yet while driving, but planning a road trip to London for labour day weekend and will be using it then. Should work fine with my Ogio metro backpack as it has a nice lil pouch for it right at the top.