So let me start of to say that I am an owner of the iPod Touch. Now I am going to be honest here and have played a little with the iPhone. So if I miss something please let me know. When I show people my iPod Touch the first thing they say is that the iPhone? I answer no and of course I get the response what is the difference. I respond with one can make calls anywhere and the other need WiFi. I think that this is the biggest difference between the two. Of course there are other differences. The iPhone has GPS in it where the touch does not. There was a difference of a speaker but that has changed with the new version of the iPod Touch. So you ask why not just get the iPhone since it sounds better. The main reason I do not own an iPhone is due to the monthly cost to own it. The e-mails I get are just not worth it. Yes it would be nice to be able to carry one device but the amount of money I would spend it is just not worth it. Now if I did get the e-mails that I needed instantly then yes I would choose the iPhone. To me GPS is not needed. I own a GPS unit for the car so I do not need the phone. Camera is another thing the iPhone has but I only use a camera to take a picture or two of the baby but that is it. Other than that I use a digital camera. So to wrap this up if you have money for the monthly fee then take the iPhone. If not the iPod Touch will do what you need when on the WiFi connection.