i think it is possible for you to notice the difference. for one thing, using a FM modulator, even a wired one, is still like listening to FM radio. but directly wiring your XM radio to your car radio would be like listening to it through headphones. did you read blkz28conv's post asking for other member's opinions on XM radio? if not,
HERE it is. it seems like opinions vary from people liking it to people disliking it.
gnahc79 had this to say about his XM radio:
I like my XM, I've had it for over 2 yrs. It cuts out under bridges (~2 sec), under heavy tree cover, and occasionally when I'm in San Francisco. My antenna is mounted on the roof and everything too. Not a big deal for me really. Sound quality using the FM modulator is inbetween CD and FM. With an aux in I think it should be much better. The FM modulator is finicky and the FM signal, if strong enough, does override the XM signal.
that's one thing i noticed with FM modulators (i have one for my iPod). sometimes the signal gets junk. like the other day, i started getting static from my cell phone. but whether you go with the wired FM modulator or an auxilary input adaptor, it's probably better than regular ol' FM radio.
and thanks for the info about blitzsafe. i saw that post when i was looking for an iPod adaptor. it's been a while for them to post anything new. hopefully PIE does come out with one for my Mach 460 soon, i think logjamselectronics had something there, so i don't have to go with the aftermarket radio route. i don't mind, Alpine has a nice headunit, but like you said, that is a whole 'nother can of worms.

btw, if you have an iPod and want to hook it up to your Stang, i have a PIE iPod adaptor you can have if you want it.