OK, so after over 11 minutes of trying I was able to reproduce the issue (see video link at the bottom). It was interesting though as it presented like it did last Saturday where the sound dropped dramatically at first and was distorted followed by the pink noise. For the first time though the noise was only momentary, then things went quiet again. When I went back to MasterFader the sound comes back after the sync occurs. On Saturday I had to quit MasterFader entirely to get the noise to stop.
Oh, also, it's definitely not a connection issue. The ipad docks solidly. I was pulling on ipad and moving the entire mixer around and it was fine.
Anyway, here's the video: