To be honest, I think you'd probably be happier if you spent a little more to replace the radio/CD player with a new deck that is Bluetooth compatible.
Another alternative is to buy a decent Bluetooth-enabled speaker set and use that instead of your boat's audio system. Of course, separate speakers won't work if you're wanting to play your iPod over big, loud boat speakers.
If you're looking for loud, decent-sounding audio, you probably are looking at a new deck The FM transmitter route probably won't be very pleasing... The inexpensive ones are downright lousy. I tried one in my pickup truck and it was barely strong enough to be picked up by the radio. Reminded me of listening to an AM transistor radio back in the day.