Think the problem is you are trying to do something that isnt designed to work that way......
When you connect your iPod, it recognises that it is connected to "something" as it will detect a signal on the UDB cable. So it's firmware shows connected. The cars system does exactly the same thing. However, an iPod when connected via a USB cable (remembering that an iPod doesnt have a USB interface, but the generic iPod one) will assume it is either connected to a Power Source or a Computer, or a iPod approved "docking system". So it will send the relevant "hand-shake" to the connected device, but wont get a response. So it will do nothing.
Your car will be doing the same, only it will be looking for a USB memory device, which it can play media files which is compatible with its programming, MP3 or the like. Of course it doesnt get the recognised response, so does nothing.
It is a common misconception that you can connect an iPod to any USB device, it simply doesnt work like this. Apple are as protective as MicroSoft when it comes to their IPR, actucally they are worse. Which is why my iPod speaker system which works with my iPod 2G will not work with my sons iPod Touch 4G. Apple decided to add more validation to thier firmware, making all older docking station uncompatible. Of course they dont publish this fact.
Ok, now I've bored you all silly......
If you want to connect your iPod to your car's stereo, you buy a 3.5mm to 3.5mm jack cable. Plug one jack into the ear pone socket on the iPod and the other into the aux jack (in) on the stereo. Put the stereo into Aux mode and play on the iPod.
No other method will work, unless, you jailbreak your iPod (break the firmware, by loading non official apple firmware) or get your Car's system updated to be iPod compatible. Of course, maybe Chevvy do have an iPod compatible version, if they advertise it as iPod compatible. There have been guys posting here with different versions of firmware on their cars system.
I know this may not help, but I hope it gives an insight into a problem that has been discussed on this board on many threads.
I am by the way, an IT consultant, and have an insight to the problem above.