This is very interesting stuff. I would love to see Firewire come back to the iPod. As it becomes more than just a music player, it makes more and more sense. Plus with chip manufacturing shrinking, it should be easier to make firewire controller chips smaller.
And with flash memory sizes shrinking, real estate density problems inside small devices might be less of an issue than they were before. Look how small 2GB of flash on a micro SD card is... and that includes the plastic cover... even many times that size is still smaller than a 1.8" hard drive, or previous flash memory chips.
The Classic is the only one still working with moving hard drive platters, and as flash becomes cheaper and more plentiful, it will probably be going the way of portable hard drives, which are also going to flash technology. A faster connection with flash memory makes a lot of sense.
I would love to see a big-capacity flash-based ipod touch, in a dock, plugged into an HDTV with a FW3200 connection (no computer involved) and playing a movie, music, or picture show with a front-row like interface from the TV's remote, or from the multi-touch screen directly.
And with digital ccds coming down in price and up in quality, and memory becoming cheaper and more plentiful, I could see such a device also becoming a small pared-down flash-camcorder and still camera on an iPod Touch/iPhone future version. Not a professional grade piece, but still a convenient little addition. (they already combined the ipod with a cellphone, why not wrap a point&shoot camera/consumer-grade small camcorder like flip-video into it, too?)
Firewire would aid with that, as well. Connect it to a TV, and use the iPod's wifi connection to start a VOIP or Cellular connection for video-phone calls... The versatility could quite significantly increase with a nice solid, fast data connection like Firewire. ALL due to firewire's lack of reliance on a master controlling computer, and faster real-world transfer rates.
That, and the increasing ability for mac computer hardware to connect with more things, and do more things, like media-PC and DVR work, and high-speed, high-bandwidth peripherals, like high-capacity media devices, storage and backup, and video output.
I really hope that this helps Firewire make a phoenix-like return to the Mac platform in a big way, as well as the ipod.