There are several apps you can use to DJ with your iPad.
Look on the app store for:
Mixr
DJay
Meta.DJ
iDJ
DJ Player 4
THese apps can all handle mixing, cross fading, changing the pitch of tracks and give control over bass/middle/treble for both tracks. Some also have the facility to create on-the-fly loops and include effects like delay, beat-repeat and reverb.
The main obstacle to DJing with your iPad is being able to "cue" - pre-listening to the incoming track while another track is playing out over the speakers. The iPad only has one stereo output, but this can be solved with the use of a DJ specific cable like the "Griffin DJ cable for iOS device" and signal routing handled by the app that sends the left deck to the left audio channel, and the right deck to the right audio channel, giving you two mono outputs so you can send one channel your headphones and one to the speakers.
If you want to get more technical, you can use a MIDI controller app like Lemur, Touch OSC or Touchable on your iPad to control more grown up software like Traktor or Ableton running on a laptop. For this you'll need a MIDI interface like IK Multimedia's "iRig MIDI", and an external soundcard for your laptop.
If you Google my username you'll find a blog dedicated to iPad DJ, MIDI Controller and music production apps for iPad.
Hope this helps.