I have this one on my list, after plenty of shopping. I think it will pretty well blow an old Classic out of the water. Even plays FLAC! 

I just bought an X1 ($100) with a 64 GB card and am very happy with it. In terms of sound quality, it would nuke the iPod (plays lossless files, better electronics, better output). In terms of UI, I like it better because you don't need any media player to manage it; just copy files from your HD onto the card and keep using any folder system you want! Very straightforward and painless! The build quality is impressive, it is all metal, and it has some very nice external buttons for volume, track advance, pause, etc--mostly lacking on my iPod Touch. Buy a 128 GB card, and it will hold approx 500 CDs worth of lossless music. Buy the X5 (next on my list) and outfit it with two of these cards and you have 1000 CDs worth of lossless music in the palm of your hand.
This is amazing to me, because I remember, even ten years ago traveling with a portable CD player, and trying to decide which 20-30 CDs I was going to take along!
I stopped using iTunes years ago after it did a number of inexplicable and infuriating things to the small collection of MP3s I allowed it to manage (I have vastly larger stash of FLAC files). The idea that you must have a media player to manage a portable device is stupid anyway, and iTunes is particularly pernicious in a number of respects (for one, it locks you into their walled garden). I refuse to download it onto either of our new windows machines (PC or laptop).
My iPod Touch developed a problem years ago with the output, but I still keep it around because I like the alarm clock, timer and such. But when it goes Tango Uniform, I will not replace it with another one, and will be completely Apple-free!
