You can do lots of stuff with them if you are tech minded and are interested in shortcuts to tedious tasks like enabling wifi/bluetooth:
You get a fairly detailed debian based dist.
I jailbreak to use the multitasking apps and sbsettings. I have used them even in my itouch 1G.
I assume you are on 4.2.x. In this case you have only the paid app multifl0w. But i use backgrounder along with the native switcher in my iphone.
Also my itouch's home button is shot. So i need sbsettings to close any apps.
It allows full access to the file system.Allows you to side load books on say the kindle etc., or even transfer them back.
The biggest pain in jailbreaking is there is no real way to backup most of the settings.
Am now trying out magicfingers that supposedly exposes the hidden gesture support(have yet to figure it out).
And then you get scores and scores of widgets and themes via winterboard.
For me the main thing is it allows me to under-use the fairiy fragile home button.