thesoundtestroom has posted a 30 minute long demonstration of one of the cheapest ways to record input on your iDevices. Dissatisfied with the audio-bleed of IK's cheap iRig, he went with the even cheaper Behringer UCA222($30) and loved it.
Not shown in this video, but definietly worth noting, is the UCA222 also features a SPDIF Out! If you already have an audio interface with SPDIF In, this is also the cheapest way to get your iPad's live audio into your PC in pure digital.
A demo and tutorial of using the Behringer UCA222 with an iPad 2 to record external audio into Cubasis and Audiobus.
In this manic video I record VST's, a guitar, bass, and a synth live into Cubasis from start to finish including some problems we all encounter..but the Behringer UCA222 performs perfectly and so does Cubasis and Audiobus