The USB is a data (downstream) port and is thus technically limited to 500ma (2.5w) or 900ma (4.5w) if it is a charging downstream port. Anything more than that and the electrical current would interfere with data transfer. This is not exclusively a limitation of this stereo, this is true for ANY stereo as these are USB standards. A USB port can either transfer data or charge high current devices (those over 900ma), it cannot do both. If you need both, get a Y adapter and connect one side to the stereo and the other side to a cigarette lighter adapter for power. However, the best way is to just charge with a cigarette lighter adapter and connect audio via the AUX input using a 3.5mm stereo male to 3.5mm stereo male cable. Using the iPad/iTouch/iPhone to control the playback is far superior to that of any non touch screen car stereo.
I'm not sure but I know it doesn't charge my iPad. It does charge my iPhone. I really don't think it is for charging at all. It's just for plugging in a flash drive with MP3s on it. I really don't use that feature because it cuts off the first couple seconds of the song and it's just not very convenient to navigate through the music.