Just plugged my touch into an XP machine WITHOUT iTunes 7.4.3 or whatever the newest version that recognizes the touch and it installed it as a camera, and created a drive for it in My Comp. Just thought it'd be interesting to some ...
this is basically because Apple did a poor job on the iPod Touch OS and iTunes currently.
My guess it's they are using some sort of hack to identify the iPods... like
if serial number in range of xxx or if flag = ipod
display as iPod Touch.
else
display as iPhone
therefore, older versions of the iTunes/drivers don't have this hack so they'll recognize it as a phone with a camera.