sorry, i have to disagree... i got the iPod touch as a gift and my first impression was "wow, this thing is slick." However, after using it for music, video and internet, not much to it really (i don't game on this thing, sorry, PSP and DS are way better)...
I liked the touch interface, especially pictures and music. Browsing the internet is cool, but freaking slow! If you're outside, then yeah, understandable, but at home? Forget it... i do it on my PC.
I don't have the jailbroken or whatever the hacked thing is, but managing media files on that thing is tedious! Unless everything is in sync with your PC... Otherwise, you gotta use Summary or something, but then everything on the iPod touch get deleted... Anyhow, unlike my other portable media players, iPod touch doesn't show up as an external device, so there's no drag and drop...