I picked up an Ipod Mini back in September, like a week before they released the Nano and rendered the mini obsolete.
I still don't regret it.
Ipods are +EV.
I take that thing everywhere, wire it into my car stereo, home stereo... and mowing the lawn has never kicked more ass.
A note about "Not needing the extra space... bull. If you have it, you will find a way to use it. Mark my words.
I use mine all the time playing online, too... it works well to drown out distractions and help me focus.