For the economically minded consumer who doesn't need the phone, cell phone camera or gps, but has wi-fi and just needs a solid pda get the ipod touch 8GB 2nd generation. I got a refurbished one for $179.00, and for my chinese work, it is amazing. It does chinese stroke recognition, there are free chinese dictionary apps, skype is came out with a free app as well.
However to use skype you need a microphone for your ipod touch. The charger that comes with it charges off of your computer so if you go on vacation you will need a wall and/or car charger. You will also want to get an audio/video cable set so you can project videos onto your tv set.