I use my iPod Touch 3rd gen every day. It is the 64GB model and I've had it for over 2 years. It's still running strong, and as mentioned, without a retina display, it's also fast.
While I would recommend buying it, remember that you won't be able to update to iOS 6. The latest software you can install with be iOS 5. This 3rd generation doesn't have any cameras. And, you also can't use the Apple Digital AV Adapter to mirror whatever is on your iPod apps, presentations, websites to an HDTV or HDMI-compatible display. However, I use Airplay with my Apple TV and it works great.
If these aren't deal breakers, go for it!