Right, so long as you don't have a 4th Gen nano (the new ones) that won't charge when plugged in, literally all other iPods do charge, but as for when it's turned off, you either have to change the source on the HU (like to radio, CD or something) other than iPod to pause it (which will then turn itself off after a minute, or pause the iPod from the HU before you turn the HU off to do the same, if you turn the HU off with the iPod playing, the iPod will continue to play without being charged by the HU.
However if you're a lazy bugger like me, you can request for free a lead that connects between the HU and iPod cable that turns it off without doing any of the above lol!
Hope this helps.