I Emailed Patryk and apparently his Retrofit uses different wiring than the factory standard. So this enables the USB and Aux socket to be used in place of the Snap-in Cradle. The Snap-in is not used then. With the Factory standard you must connect the iPod via the Snap-in cradle. but as there is only 1 Snap-in for the iPod and this does not support media the only solution other than modifying it as per Patryk's modification is to buy an iphone 4 Media cradle and make some padding to hold the iPod in place. Not ideal.
Thanks to Patryk for clarifying this.