If history repeats itself, the next iphone will have the A5 chip that's in the Ipad2, and the new ipod will have the same guts too. Currently apps like good player and avplayerhd on the ipad 2 can use both cpu cores and playback 720p mkv, avi etc file types without any problems. Use the new HDMI out feature and you've got a pretty useful media player. If the ipod has the same tech inside then i assume it could also run the same apps and then play the same files. HDMI out already works with the current iphone so I wouldn't see a reason why it wouldn't work with the ipod. 64GB ipod touch would be very affordable compared to a htpc and the portability would be useful. Also there would be a lot of possibilites with jailbreaking and xbmc.