I recently purchased an iPod Touch 4 32GB for a friend off eBay. The first impression was WOW!
It’s almost as slim as a credit card (or 2), very sleek and works extremely well. The basic differences between and iPod and the iPhone 4 are that the iPod lacks the phone (GSM), GPS, Compass, Flash, no HDR mode for the camera and has half the memory, i.e., 256 MB.
The most amazing part was the accuracy of the location on Google maps using just WiFi. This is far more accurate than the GSM triangulation in all the locations I tried. Latitude also works great as long as there is some WiFi around.
Facetime, Viber, Tango, Talkatone, Fring, Skype, Facebook etc. all work great.