I have been struggling with this myself now for several days.
When I first saw the touch, I was dead sure I wanted one, but after some more thought, I'm leaning towards the classic.
Firstly, the classic offers me the storage I want and has a better battery life than the touch. The iPod has never been known for having great battery life in any model.
While I love the thought of having safari built into the touch, requiring a wifi connection is less convenient than it sounds. It's not like being on a cellular network that is available anywhere. Requiring wifi means you have to walk into a Starbucks (or some wifi equipped location) and you have to stay there until you're done. Not that convenient in my opinion. I still think it's a cool feature but not sure how practical or useable it is in real life situations. Kinda like watching a movie on the new nano. Cool feature but perhaps not that practical. Also not sure what that big screen is gonna do for the already bad battery situation. I also love the eye candy that is cover flow, but I find it annoying that you have to rotate the touch to use it. It seems that two hands would be required to do that comfortably (not to mention many other functions) which is rather awkward, especially if you're on the go.
This is probably the most important reason, more so than the battery issue, that I am leaning towards the classic over the touch. The click wheel. It is such an awesome design and is very much (imo anyway) greatly responsible for the success of the iPod thus far. I think this was obvious to Apple when they orientated the buttons above the wheel in the 3G iPod and subsequently put them back when they released the 4G iPod. Controlling everything in one hand using only your thumb, and in many cases,not needing to look at the screen is clever, well thought out design.