Ian, hope you figure it out. I use my iPod connected with the same white USB wire as you do. I've had one instance where it got a bit funky once (I took it out to update the iPod with more music) and when I plugged it in, it didn't recognize it immediately. So I did the same things you mentioned, turned off the car, unplugged it, plugged it back in, turned the car back on, and then it was ok. I also occasionally have an issue with it displaying the song/album info. Can't seem to figure out any pattern to that, most days it displays ok, but every now and then it won't.
2011 Silver SL-Mfg 8/11-Purch 6/12