RDS is an acronym for Radio Data System. Its just some programming that allows the headunit to receive and display radio station information such as song title, artist, station name...
Also, I did a little searching on google and found this quote on another forum...
If you have your own XM receiver you can just buy the PAC AAI-NIS auxillary adapter and that will give you 2 aux inputs and you can use one for ur XM and the 2nd for mp3 player...
the PAC unit plugs into the back of your radio into the SAT plug and you can just hit the radio button to get to the SAT channel to listen to whatever is being played thru the aux input...
It came from an Armada/QX56 forum but it may apply to what you need.
Here's the link to what I found...
Pathfinder [Archive] - Nissan Armada Forum: Armada & Infiniti QX56 Forums
I found this information on section 28 titled "satellite radio".