The new iPhone and iPod Touch firmware is officially out, though the iTunes Store is either down or two busy so I can't actually buy it.
One thing I noticed going through the App Store— there's still no proper word processor for the iPhone/iPod Touch. This is something Windows Mobile devices have always had over their Apple counterparts; they run Microsoft Office Mobile, which, as loath as I am to compliment Microsoft products, frankly rocks. Apple Notes is not nearly powerful enough, and as for the online solutions, Google Docs only lets you read documents on the iPod, I couldn't get Zoho Writer to work at all. The only online solution I found that works is Glide Mobile, which is terrible.
i used to write all the time with my Palm Pilot and fold-out keyboard. It was great because it was cheap, had a long battery life and was really light to carry around. Eventually, though, I got tired of only being able to write in plain text and having to convert things to and from the Palm Doc format all the time. However, newer devices have much better word processing solutions. Warren Ellis, for instance, writes on his Linux-based Nokia N810. At nearly $500, I think I'll pass on getting one of those myself (you could get a laptop for that these days), but there's no reason that a word-processor and a full-sized external keyboard couldn't turn my iPod Touch into an extremely useful writing machine. So why don't either of these things exist?