This is weak from Apple - an inexpensive 16GB iPod Touch would have filled a really big need for kids (and their parents), but taking out the camera makes it pretty lame in my opinion.
Really don't understand what's going on at Apple these days...
EXACTLY. I have been looking to make the transition for my son from my old 3GS iPhone(no sim card) to an iPod Touch. I've been waiting on iOS 7 news to make this jump. The lack of a rear camera means this is simply NOT an option. I have to believe a LARGE segment of the iPod Touch consumer base is in a similar situation - purchases for younger children. And NOT having a camera makes ZERO sense here.
It makes no sense, IMHO.