No, that is an auxilliary input. It has nothing to do with the ipod source/tab/whatever. With the player plugged in and playing, go to the AV source screen and look at the bottom left of the screen, there should be some smaller buttons labeled "AUX-1", "AUX-2", "EXT-1" and "EXT-2". One of those is the source you select for using the mini jack on the front of the unit, but I don't remember which one is the front input off the top of my head. If none of them are availiable, you need to go to the settings menu and turn on the one you need. It should say in the manual what the unit refers to that input as.
The ipod source can only be used with an ipod connected to a dedicated ipod port on the rear of the unit, which allows you to control the ipod using buttons on the D3's screen.