Ummm, why bother with playlists?
iPods of all shapes supports audiobooks natively, the only thing is that they need to be iPodified
The Audiobook format for iPod is usually using the extension m4b, and there are a couple of advantages to it, the biggest one beeing that you can combine alla the mp3files in an audio book to a single m4b file. And when you play it on your iPod it "remembers" where you are in the book, so if you quit listening, it picks up where you left of automatically.
There is a freeware program out there that I can't remember the name for right now that allows you to take a bunch of mp3 files, combine them to a single m4b file that you can transfer to your iPod via itunes without any problem.
I use this all the time since I have iPod connectivity in my carstereo, so I listen to books while driving too and from work.