I cracked, and got one of the new iPod Nanos. It really is a big step up in design, it is gorgeous. Best hardware anywhere. And the high-rez screen is amazing.
Aesthetically, one small flaw, in my taste: the white scroll wheel does not match the subtle blue of the case. Even grey or black would have been better.

More seriously: I had looked forward to the high-rez screen, so I can read the full title of an audiobook without having to sit and wait for several seconds like a chump, waiting for the text to scroll by at its snail's pace. (I often use this, because audiobooks are divided into several parts, and the number of the part only come after the title, which often is long.) And what did they do? They put the book cover filling half the screen so the text has to scroll anyway...
But wait: didn't I see an option in iTunes to turn off the art on the screen? Oh yes I did. Plug in the pod, and turn this off. Testing, testing. Now, instead of the album art (which was too small to be useful anyway) is... a generic iTunes musical note icon, even less useful, and still using the space which could have been given to the text.
Sigh.
Same old story: the hardware people giweth, and the software people taketh away.
[Update: I just updated the software on the iPod, and it deleted all my careful selections of the main menu items. Oh, come on. Apple, you can do better, you do so all the time.]