If music (or whatever was playing on the iPod) is a "performance enhancer" then all distance runners should have to wear noise canceling headphones to prevent crowd noise and other "environmental" factors from affecting their performance.
Yes, the rhythm of the music can help pace you, and it can help distract you from the discomfort of you body, but so can humming, thinking about a specific topic, counting your footsteps, etc. Playing audio on your PMP doesn't give anyone an unfair advantage, even if other runners aren't using one.
That's an even more ridiculous rule than the (now revoked) rule disqualifying athletes who took pseudoephedrine (e.g. Sudafed) to treat congestion due to allergies or cold. Anyone who has ever taken it can tell you it doesn't enhance performance above "normal" levels. In fact for many people, it may make it difficult to concentrate, which is a distinct disadvantage. Even though reducing the congestion will help improve performance, someone who is taking it for allergies or cold will definitely not perform as well as when they're healthy and not taking PSE, so at best it simply gets them back to near normal performance.