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The only difference is that 4S is white, right? And that it has a chip?

What is the purpose of the chip and I heard that the new iTouch 4S will run on "iCloud". What does that mean?

I'm not a techsavy person (as you could see) and looking to purchase which ever one is easy to use for a newbie :p

Two things. It's an iPod Touch. And I have no idea what this "4S" you're talking about is, unless you're referring to the iPhone 4S. And the iPod Touch comes in black and white regardless.

Oh, and all mobile devices have a chip. If they work, that is.
 
One thing to keep in mind that iPod Touch 4G has a quarter Contrast ratio to that of iPhone 4S/4. iPod has the worst black levels other than that it's quite awesome and very thin.
 
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