For the sake of clarity what do you mean by portable- I have set up back of car type rigs using car batteries before (doubly nice as there is no AC hum) that hurt your ears if you stood close enough.
Not necessarily suggesting you go that far but a car battery or three and a half decent amp and speakers setup will do you proud. If you are willing to get your hands dirty then many hifi units things step down to 12V internally- hook the battery in before the regulator circuitry (car batteries are not the nicest power source for sensitive electronics) and patch into an audio rail (essentially using it as a crude line in) and you are away (if you have an old boxed hifi I would do that- more modern gear might not be as easy).
If you can borrow some car gear this is even easier as it is built for it.
"needs to work with ipod touch 2g"- does apple not provide a headphone out port these days?
edit: urgh must look at post dates.