I just replaced the stock HU in mine after long thought. I already had an iPod so I did not need a changer. Added XM and love it!
Alpine CDA-9856 $199
KCE-422i iPod FULLSpeed $29
XMDirect adapter for Alpine & XM universal tuner $69 (after $30 rebate)
Stock head unit removal keys $6.99 (eBay)
Volkswagen Receiver Wire Harness 1987-up $12.99 (did not need any modifications)
Volkswagen Antenna Adapter OEM radio male to Motorola antenna female $9.99
Male RCA to tinned wires from Radio Shack $2 each
There are a number of threads here that deal with install options. I've summed it up to make it easy.
The image is of stock wiring harness pin out.
Here is the wire color chart:
Brown = Ground
Pink w/ yellow stripe & green dots = 12v ignition\switched
Gray w/ blue stripe = Illumination
Blue w/ white stripe = Amp turn on lead
Red w/ green stripe = 12v constant\battery
Blue w/ red stripe = Left front negative
Blue = Left front positive
Yellow w/ brown stripe = Right front negative
Yellow = Right front positive
Installation was easy. Ran the SAT antenna line in the trunk along the same path as the third tail light. I highly agree with DickB and used the preamp leads from the HU with inline RCA to tinned wires to connect to the amp and not the speaker outs.
Another point I wanted to bring up is to take your time and don't, DO NOT, use crimp on butt connectors. Sure that's what Circuit City did on your sisters Prelude. It's fast. The connection can come undone too and before you know it, you've shorted out something. If you have one, use a soldering iron and after the wire ends are split, twisted and twisted, drop some solder on it. I would also suggest using high temp wire shrink over the connection rather than electrical tape. You've just spent hundreds on your new head unit, make it last.
Verified wiring for my 1999 SLK230 matched up with the Alpine and through the VW wiring harness the colors mated perfectly except for swapping the ignition yellow and battery red.
I love the sound and endless music I get from XM, MP3s burned to CD and my iPod. I'll try to dig up some pictures and post them.