I went ahead and got the 8gb version! That should be plenty of room for my music and a boatload of apps! So far I have downloaded around 20 free apps and 1 that was $.99. With my entire music library I am still under 1gb on the thing.
There are so many cool apps out there! I have 5 or 6 games for my kiddos to play and they LOVE it. The ones I got are very simple but colorful and fun. http://eliassmiles.com/

I also have facebook and mapquest and a radio program called Pandora and skype and an entire betty crocker cookbook and a German language program among others!
I LOVE it!