As someone who's been lurking reading lots of threads etc., I have a theory for why the iPod touch appears to be be better after the update. Indeed, whilst I can't tell too clearly as thus far all I've seen is the 'sync in progress' screen (the update caused a restore so all my music is syncing back, oh-so-slowly), my week 37 screen - which previously appeared to be pretty bad - now appears to be considerably better. At the same time, I think the person who mentioned the screen looking 'washed out' earlier may be right, as mine does generally look a little 'lighter' than it did before.
So, taking that in to account, I think it's simple: Apple altered the UI - or maybe even just changed a coloursync profile or something - so that the screen never uses complete #000000 black. Because, at least with my screen, it was only the absolute deepest blacks that showed the negative problem - even slightly lighter blacks looked fine. So, changing the UI's 'deepest point' to, say, #050505 (I'm just making these numbers up btw), would get rid of the negative black problem on the first iPod touches by stopping them attempting to display pure black. But also, this would mean that iTouch W38+ models wouldn't be adversely affected; all they'd see is the same slightly paler UI that we W36/7 people see.
Now, I'm absolutely not saying my theory's right... but I think it's fairly plausible. And if it is correct, it means W38+ iTouch owners needn't worry about the update adversely affecting their iTouches (unless they're worried by the slightly paler UI). It might also explain why the update has worked for some people and not others; some people's iPods might be so badly affected that theirs needs to have an even lighter UI - maybe #101010 - to stop the 'negativity' appearing - which Apple didn't do because it would have made everything a bit too light.