Because of the small size of iPods, they have to use a SoC (System on Chip) solution, and not a general purpose CPU + Northbridge + Southbridge chipset like a regular computer.
From the PortalPlayer website, they say their products use 32 bit ARM 7 cores, which might lead to Apple using an Intel XScale (previously called StrongArm). But who knows? Maybe Samsung, etc...
So we might as well conjecture MacRumors style

I say these are possible scenarios:
- A new asynchronous logic CPU that uses even less power
- Some new chip with hardware H.264 or whatever video decoding
- Some other boringly similar chip that's $1 less
- A GPU baby, and everything's coded in pixel shader language!

- What, no one's mentionned Cell yet?! Finally, OS X ported to Cell, running on an iPod
- From the dungeons of Transmeta... Are they still in business?