This is coming from someone that previously owned a 2nd generation iPod. yep, the touchpad was touch sensitive, but the buttons were around the wheel, the screen was monochrome, and it was rather fat. the new one is so much thinner, and holds 8x more music than my original one. It was also cheaper than when i bought it back then. I think i paid close to $400 for the 10 Gig model, if i remember right. this one cost me $240 or so (yep, apple discount via a friend).
I'm currently trying to figure out what else it can do. It seems to be able to play better games, play movies, and keep track of different clocks. I seriously got it mainly just as a music player since i liked the original interface.
Time to go look up at some video podcasts. :)
The iPod classic 80GB is awesome! Great iPod and considerabley better pricing than the iPod touch. Best iPod that's out there in my opinion!