I have installed cheap ebay (from China) helmet speakers in both my full face and open face helmet. I use them for my iPod which I place either in my jeans pocket or tank bag (if it is on the bike).
They are not the quality of my Sennheiser portable headphones which I use while walking with the ipod but they are average quality - and inexpensive. They were easily fitted and they have a volume control on the lead. But yes, I do need to have them on full volume - I have quite noisy pipes. The sound is better in the full face (less wind noise) and if you have quiet pipes then you probably wouldn't need full volume either.
In the helmet they operate as open headphones - not closed headphones. By that I mean you can still hear important stuff in the surrounding environment. They do not obliterate outside noise like studio headphones.
I do not find them distracting in the least - no more than listening to the radio while driving in your car. They make cruising very enjoyable while listening to your favourites .
I don't know of any headphones that would benefit from being bathed in water, but at least these are so cheap it wouldn't be a drama to replace them.
