iPod touch $399 iPhone better than $399 iPod touch?

[parrotheadmjb]

To those of you who own both the 8g iPhone and the 16g iPod Touch, overall which is a better buy? Is the screen and hiss really that bad?

 

[madmaxmedia]

From iLounge-
http://www.ilounge.com/index.php/articles/comments/ten-things-you-need-to-know-about-ipod-touch/

Sound Quality: We’ll have more to say on this soon, but the iPod touch is more like the iPhone than the iPod classic, with a higher level of background hiss than the classic.

The way describe it, I don't think the audio is worse, although the screen thing remains to be seen.