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My immediate suggestion would be to try to buy a used MINI head unit from a later model year to replace the 2002 one. One that supports the Aux input adapter.

You could buy a new head unit, but that is very expensive.

 

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You could fit an aux in convertor to the cd changer socket for a cleaner sound

 

A GLI is a transformer and it basically isolates the connections so that you don't get multiple grounding points. Adding another GLI in the same signal path won't do anything because the point is already isolated.

Is there anyway to change the FM operating frequency for the modulator? If so, you might try to change it to another area of the band to see if it's just a noisie spot.

If the static seems to whine, like with engine RPM then you'll have to look into some power line filtering.

 

Thanks for the tips!
I can't use an AUX because it's a 2002. But I finally figured it out. It was all a ground loop issue. I used one power line noise filter and one ground loop isolator. The two together eliminated almost all the static problem, except when no music is playing. It doesn't fluctuate with the engine, so it it is sort of a bizarre ground issue that the isolator and noise filter fixed. I don't care how because it works.

I finally got the car back together after a broken piece and multiple headaches. But it was worth it, because my sister would never have fixed it, or payed $200+ to have it fixed. I think it will make a great X-Mas present when she comes home from college, hopefully she won't kill me when she finds out I tore her Mini apart!

 

I'm 99% sure that the limitation for the 2002 is only because of the head unit. If you replaced the head unit with one from a newer year, you would be able to use the OEM Aux.

Just wanted you to realize that.