The device you refered to is the Lyra from RCA, but they (RCA) have since declared that it will NOT support the Microdrive. Another problem is it doesn't play real MP3 files. See links below and make your own determination. As far as a Microdrive for the car unit, I think it would certainly add to the user friendliness. Of course, the same port that supports the Microdrive should also support memory cards, making it that much more adaptable.

Link: http://hardware.mp3.com/hardware/individual/portable/2335.html
Link: http://bboard.mp3.com/mp3/ubb/Forum55/HTML/000008.html