Fabric Sensor company Eleksen will introduce a iPod music case at the MacWorld 2006 this week.

I met Elekson last year at the CES 2005, where they demoed products that make use of their fabric sensors.
Eleksen has developed the only MP3 player case with external volume controls for both headphones and speakers.
The generic case for mp3 players supports volume control (see photo). The iPod music case has 5 fabric buttons to control an iPod: Play/Pause, Track Forward, Track Back, Volume Up, Volume Down and iPod ON/OFF. So you never might see your iPod again, it will stay inside the case forever. The music case' smart fabric scroll volume controls enables operation via a simple finger scroll along the volume controls or a press and hold volume capability.
Eleksen caters to the OEM market. So we have to wait until a company is selling these iPod music cases under their brand.
More details in this Eleksen press-release.