I see nothing wrong with using headphones when cycling (although I haven't got into using them myself), as long as you take extra care to be aware of what's going on around you. I was overtaking a woman cyclist in front of me recently on the cycle path, and as it was a rather narrow section I made sure to give her plenty of warning with my bell, but just as I got level with her back wheel she suddenly veered and ran into me! It was only then that I could see she was wearing earphones and was completely unaware of me. Either you need to keep over to the left, or keep looking round. Preferably both!