The best thing about an iPod was most certainly not the wired headphones, it was how much music you could store compared to most preceding devices.

The second best thing was the scroll wheel. Interfaces for music devices before it were so janky. I loved my iPod.

Beyond storage some of the other "best things" were the easy to navigate UI with the click wheel, instead of the finicky buttons or multiple repeated swipes that other devices required. Also the iTunes integration. Having a solid music app on the desktop, that made it easy to create playlists, which could that automatically sync with the iPod so everything was there without a bunch of work, was a game changer when it launched. I bought my first Mac to get iTunes, because the software on Windows at the time sucked so bad.

I got my first MP3 player in 1999 or the early 00s. The SAN disk card had 16MB and I had to cut a song in half so I could fit 3/4 songs.

They could theoretically add a headphone port to this and a bluetooth to headphone adapter. I don't think the chips for that take up much space at all.