Even though it was against all of the Apple hate that I have, I bought an 8gb iPod Nano a while ago and I love the little guy. iTunes is slow as hell and I try to use iTunes as little as possible, but iPods do have nice podcast syncing and, well, pretty much every third party gadget is made for iPods. Even though the screen is small, it has a nice resolution and I have wated 40+ Minute videos on it without any problem. I usually listen to it while gaming or doing some activity, so sound quality wasn't priority #1, it has passable sound quality in my opinion.
If you're looking for sound quality, I would highly reccomend the iRiver Clix 2nd generation. The 8GB model will run you around 235$, which is a decent price even though it's a bit on the high end.
