Yes, you can control your 701 with either.
Besides the screen, graphics, and interface, the 505 brings back the mute button that we lost from the 200 to 205. Thank goodness. The plugs are different on the back as well. There are separate harnesses, so if you aren't using the RCA outputs, you don't even have to have them pigtailed off the unit. There is also an included USB port cable, which you can use for full Ipod control. There is still the dedicated high-speed Ipod cable port, so you can hook up two Ipods and switch between and control them separately, all from the touch screen. This is cool when someone else hops in your car with their own Ipod and you dopn't have to unhook yours. They show up as "Ipod 1" and "Ipod 2" in the source selection screen. I can't think of any other differences right now.
I do wish Alpine would go back to the interface that the W200 had for the graphic EQ on the 701. It actually showed a graph instead of just listing out the frequencies and the levels next to them. Oh well.