which ipod touch to buy

Is this for personal use, app development, gaming, listening to music, other applications?

If it's mostly for music, I'd just select the largest capacity. If you game a lot, I would buy the fastest processor.
If you won't need the 32gb, definitely go the 5th gen route. Personally, I don't have a huge music library and don't carry around movies or tv shows with me - so I stuck with 16gb for my iphone and it's just fine. Plus, the 5th gen is a pretty massive improvement over the 4th gen. (Camera, display, size of display, thinness, processor, gpu, colors)
fairly large price difference. A refurb 64gb ipod touch 4th gen is 229(32gb 179)at the apple store. A new 32gb 5th gen touch is 299(399 for 64gb).
The new one is pimp,if money isnt an option.