(Posted this in another thread - "Acura Music Link - Issues after iTunes 7 and update 1.2" - copying here as well, since this seems like an active thread.)
I just updated mine to 1.2 - and have a 2006 TL - but don't use the Acura software (too much of a pain), and mine appears to work
generally fine on Disc 5 (album shuffle). However, if I turn off the stereo, or switch over to something else (like XM) and come back, it may or may not skip for about 10 seconds, and clears itself up. It may pick up where it left off. It may even keep playing, so I have therefore missed part of the song.
But here's the kicker - when I turn my car off, the song starts playing again. If you disconnect the iPod, it takes a good 10-15 seconds to start responding to key presses. (If you disconnect before turning off the car, it behaves the way it should.)
I only discovered this today, when I got in my car after work, the display said it was where I'd left it, but it certainly wasn't the same song I turned off at. I think it actually kept looping the album I was on all day.
So, I did some experimenting, and if you turn off the stereo, it will absolutely pause the iPod - but the song will start playing again as soon as you turn off the car.
Hopefully, this points someone in the right direction.