BTW, I just read ecschwarz's post and there doesn't seem to be that big of a difference...oh, well. I'm still buying the darn thing. lol.
The iPod touch updates have mostly been evolutionary and this is no exception. For most iPod touch 2nd generation or 3rd generation users, this update is not a "I need to run out and get one", unless they want Face Time or more storage space. The same argument took place with the iPhone 4 - 3GS users didn't really have a compelling reason to upgrade except for all the little incremental improvements.