i have a touch2.0 i use my touch as a pda, yes there is actually a great pda program out for the touch now and i've had pda's since the palm pro(and every other device since) this is the best pda i've ever seen, ok aside from that i use it to read a lot pdf's i'm back in college and all my books are in pdf now, the itouch looks amazing, it puts my ds to shame if it had the same viewable area as my psp it'd put that to shame too, and i actually find it more comfortable to read on the touch than my laptop or computer.
i use airsharing it was free when i downloaded it, it's simple to use, download it, put in a few settings and you copy, yes thats right you can copy all the pdfs you need to the touch from wifi, none of that stupid read online storage crap, it lets you actually use the 8/16gigs for more than music or video storage.
the screen is beautiful, if apple made a novel size version of the touch(like sony prs or kindle) i would buy that instantly i love this so much, navigation is a blessing, however it is damn small!!! i can flip it horizonal and read w/o scrolling side to side but i just have to scroll up and down, lots.
i find myself using the touch to read with a lot but i find myself wishing apple would make a bigger version, like now(cuz i have no idea how the sony does pdf's), oh i hate apple btw, i even engraved that they are the evil empire since they offered free engraving.