You turned the ipod volume to near-max, switched the radio to "Aux" setting, then adjusted the radio volume, and you were hearing the radio? If anything, you should either be hearing the ipod or nothing at all, not the radio. Are you sure you're on the "aux" setting on the source button?
One possibility reported by a member was that the auxiliary cable itself was disconnected. This would require removing the Radio 10 and checking the aux cable connection in the back. Removal is not difficult:
http://www.evilution.co.uk/index.php?id=523