Apple is saving one more life for Ipod touch next year by releasing the 16G version for US 249 and new color (black front, back red). Although, 8G is out of the question. Camera is 5MP and shoots 1080 video, that's like 100mb plus for each you capture. 8G will be gone within the first hour you bought the Touch.
I think 32G is suitable, so you don't have to worry of filling up the capacity all the time.