I don't see why people are complaining about the complainers on this one. The iPod Touch is their flagship product, and holds 16gb of music. I guess you could complain that 24 or 32gb of flash memory would cut in to their profit margins slightly, or that putting in a hard drive would make it thicker, but the fact remains, 16gb for a device primarly designed to display movies and 16:10 aspect TV is pretty damned small. And keep in mind it's supposed to replace your ipod as a music player, not supliment it, so your music collection has to fit on there.
Would a 30gb iPod Touch that's the thickness of a 5G iPod have been so terrible?