The new iPod interface is cool, but I've found my 4G nano to be perfectly sufficient. It can't hold all my mp3s and audio books at once, but then I don't listen to them all at once anyway.
Now, my wife and I have AT&T plans (why, oh why did they change the name from Cingular?) and she was having a lot of trouble with her phone. Since she carries a phone, iPod, and PDA everywhere, I went ahead and bought her an iPhone as an anniversary gift ... last Saturday ... which she activated on Wednesday ... the day they dropped the price.

From what I've read online I can get the difference refunded so I'm headed to the AT&T store today.
She absolutely *loves* the iPhone -- particularly the email and web features. She's off and a dog show now and completely enjoying staying connected. The interface is intuitive, and she gets all the functions she needs. There are a few things she misses about her older equipment:
- No downloadable ringtones. The ones with the phone are pretty sad.
- No voice dialing.
- IPod functions can't be manually managed -- they have to be synced. That's a pain because we share one computer with iTunes, and it is much easier to drag & drop files to the device than sync.