Have you seen the touch in person, its sexy. It wouldn't have the same form factor or battery life with a hard drive based system. 16gb for most people is plenty, i still have 3.5GB left with over 1400 songs at 200-300kbps VBR MP3, and 8 videos at around 50mb each.
Many people don't realise that the touch's use solid state drives now, no more hard drives spinning. Thats why the capacity is so small ... Creative is doing the same thing except they're releasing a Zen with a 32GB drive.
I have one and love it, while i still have 4gb of space left over on my 16gb with 8 videos and around 1350 songs at 200-300kbps VBR MP3 i wish there was more memory for down the road. Other than that i don't really have any other complaints about it.
Wish i had your budget when i was peicing together my audio setup. Go for the Onkyo SR605 reciever, and then get a good speaker package or peice it together separatley.
I would like to think its going to happen, and i do think that it will. Its not really a downside for customers, more content at the same price most likely.
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