Just thought I'd share this for anyone interested.
I recently bought a waterproof Ipod that is amazing!
It is not an ipod in a case but an original Shuffle Ipod waterproofed by Underwater Audio. They sell the Shuffle with waterproof headphones with 3 different sizes ear plugs. They also include a set of ear hooks which I don't like. While I don't like kiting with music I have been using this thing religiously while swimming. I have yet to have it come out of my ears after many many hours including flips turns.
For kiting you could easily just tuck this little guy into your wetsuit and run the ear buds out your neck.