So, if they release a 1GB Nano, you'd think it'd have to be priced at $149. There's a couple of things I see wrong with this:
1.) A big reason for having the Shuffle is so there's a low-cost iPod (i.e. sub-$100). With no $99 model, I think they'll lose a lot of sales.
2.) Isn't a Nano formfactor with the color screen a bit overkill for 1GB of capacity?
What makes far more sense to me is to make the 1GB Shuffle $99 since flash prices are cheaper now than when the Shuffle was debuted. And either dump the 512MB Shuffle or price it at something like $79 or less.
-OR-
Dump the 512MB Shuffle, add a 6GB or 8GB Nano and then set the prices at:
1GB Shuffle - $99
2GB Nano - $149
4GB Nano - $199
6/8GB Nano - $249
Even though I have no interest in a shuffle for myself, I think it would be a mistake to get rid of it and maintain at least one sub-$100 iPod option.