If money's a factor, you can always go the route I did - go to the Apple Store online and look in their refurb section. Everything on there is backed by the same warranty as the new stuff. They used to have (and may still have) first gen (black/white) 2Gb nanos for $99, for example.

For Christmas I got a refurb'd 60GB iPod video. I'd told my parents that I had no need for 80GB, but 30 was too small (they really should stick a 60GB in that $300 hole) and pointed them to Apple's refurb site. Since the 5G 60GB is for all intents and purposes the same as the current generation aside from the capacity, it seemed like a good call.