I found the myvu
on Gizmodo today. It's a cross between a video monitor and a pair of sunglasses. Although it may look like virtual reality, it's main purpose is to play downloaded iPod video content.
While this may provide the answer to the problem of tiny video screen on your handheld media player, it does not solve the "looking ridiculous in public" problem. Perhaps this might work on a train or an airplane, but it's applications seem limited.
On the plus side, they've been designed so that you can see what's going on in front of you by looking above or below the player.