the ipod touch, to me, makes no sense. it's just eye candy without the mass storage gooey center of the ipod classic.
i have, and love, the 160gb ipod classic. it holds/archives over 7,000 of my songs, over 2,000 of my high res photos (i take a lot of shots with my digital rebel), about 8 full movies, and is still under half the capacity. works great as an external storage device as well, and i have the other 80gb at my disposal.
i lost all my music and pictures when an old hard drive decided to fry out, so being able to archive my full music and photo collection on my ipod is important.