You have to remember too, most app buyers and Apple product owners, aren't exactly in the "saving birthday money" age bracket. If you're over 20 and saving birthday money, you got issues!
And also, theres thousands of free apps, cant get cheaper than free kid!
I am probably gonna be the only one to admit it here but I am over 20 and am using birthday money to buy this! Reason being is because it comes out around my birthday and no one else knows what to get me so its all cash, which basically covers the iPod.