i don't know why these were never more popular. maybe because of the archos name recognition (or lack of)? the only place in the so cal area i knew that carried it was best buy, and even then only for a short while. i think the original firmware had problems, but as long as you knew to download the new versions, everything worked fine. i'm not even sure you can still get the jukebox multimedia 20 (jbmm 20) anymore as archos came out with a new version (av120?) about a year after this one. options included a camera module to record video or pictures, cf or smart media card readers, an external microphone (it has a crappy one built in), and an fm radio.
i've never used the ipod, so i have no frame of reference for you.
as far as your questions:
1) i would discourage trying to navigate the menus while driving, i think applying makeup while driving may be easier. what i have done is to create subfolders (ie jazz, oldies, hip-hop, classic rock, etc) and selected the options for random play and within the specified directory. i also bought the digital video recorder module that has a remote control that i use in the car.
2) i got mine right before the usb 2.0 adapter was released, and never bothered to look for one since i only had the older usb on my computers. it does have firewire capability as an option. iirc, i initially transferred about 200 mp3's (all at 128k bit rate - around 800mb total) onto it and it took about 14 or 15 minutes . now that i have my 8890, i plan on looking for either the usb 2.0 or firewire cables.
3) the mp3's are stored just like they would be on a hard drive. you can rename them, copy them to different location, drag and drop between your computer and jbmm, etc. when it is connected to the computer, the jbmm is recognized as a mass storage device, not an mp3 player. any type of file can be loaded onto it. i imagine you could probably load an os onto it and run (slowly) from the jbmm. one cool thing i noticed after one of the firmware updates was that the album cover is displayed while the track is playing. i even played around with some freeware that allowed you to rip dvd's as divx, though i never had the time to get that totally working. i could never get the sound and video to synch properly. it does not have macrovision protection so you could use it like a vcr and record (mpeg4 in avi format) a full dvd onto it and then play it back on the built in display (something like 350 x 280?), or while hooked up to a tv. i've even heard of people hacking them to put in larger hard drives, though i would not consider doing something like that.
overall, i am happy with this unit. the sound quality is better than what i expected (i had low expectations), but not great. it is more than adequate for use in the car though. i have a head unit in the car that allows for direct connection via rca jacks and i would recommend that over those devices you can transmit via fm radio or cassette. my car had a 10 disc cd changer and the head unit can play mp3's on cd or cdrw - i rarely use either option since
i got the jbmm. in fact, the only time i use the cd palyer is when i buy a new cd and can't wait to get home to listen to it.
hope this sufficiently answered your questions,
forgot to add that the battery life is decent, about 6 hours if played continuously.