Maybe I'm behind the curve, but I recently bought a new car and immediately wanted to upgrade the crummy stock sound system. In my older car, I pulled my gear which includes a Alpine 9887 head unit which will play back WAV files from my iPod via the direct iPod usb connection. I've been really happy with the audio quality from the 9887 (except for the hassle of the whole "Imprint" tuning ordeal with additional hardware and software).
I was thinking about getting a new double din unit with all the bells and whistles instead of dropping in my old Alpine but as far as I can tell, all newer head units including all Alpines will only play back MP3, WMA and AAC encoded music files through an iPod (unless I want to use a standard Auxillary connection which kind of defeats the purpose of best music audio quality + iPod control through the head unit).
Have all car audio head unit manufacturers dropped WAV file support and if so, why?