Morning,
Not totally sure whether or not you can stream from the iPhone. The link below looks at the Chordette Gem (circa £399 IIRC) which works on Bluetooth and USB.
NEWS: Sumiko Announces Chordette GEM—Combo USB/Bluetooth DAC | AVguide
"Interestingly, the Chordette GEM can receive digital audio streams from Apple’s iPhone 3g and 3GS and the 2nd-generation iPod Touch—capabilities made possible by Apple’s recent release 3.0 software. The Sumiko release adds that, “even the earliest generations of the iPod Nano, Classic, and Touch can be used with the GEM simply by adding a Bluetooth adapter (available separately)."
Maybe this might be a solution rather than going down Squeeze route.
I hope this helps.
Anthony