(By JakDillard)
First you will need a gsm touch diamond rom or touch pro rom - extract the drivers relating to the fm radio i.e. fms.dll or fminit2.bts -move these file into your oemdrivers folder (replacing the one that are already in there) and BAM done .... I got this to work on a rom I was working on then I got a Touch Pro so it does work however the sound is not that loud.... enjoy
http://forum.xda-developers.com/showthread.php?t=442239