Depends what that 5k includes. If it's speakers, wiring, amps, electronic music sources and remotes, then it's not a bad price..... But the purely control end of what you want can be got - in a variety of packages - from eg Logitech Squeezebox for about 1k. I have two zones here at AGB Towers, each driven by a wireless Squeezebox Classic decoder, and all controlled by a single Squeezebox Controller - allowing me to choose exactly what I hear, where and when. Less than 1000 US for the control system (amps, speakers, wiring all extra....).
One thing though - if you want to use your IPod itself as the physical source of the music stream you are, imho, complicating thaings a bit. Easier would be to use a PC or Mac as the music source, with a dedicated drive that is set up to always exactly mirror what you have on your IPod. Software for doing this is usually free; obviously you need a home computer too - but dangling a dedicated hard drive off that will only be about 100 bucks or pounds.
AGB