Remember that the iPhone is everything BUT a phone. If you want a mobile phone, there are much better alternatives out there. Unlocking such device is like playing the russian roulette: you may win, but the risks are far too great. Also, is quite expensive, both when you buy it and when you use it, with terrible contracts and all that. Think of the iPhone as a glorified Blackberry, I think that's the closest thing to it. On the other hand, there are tons of apps for it, Apple is releasing the official SDK for it soon, and iPhone users love the device. You could also consider something like a Nokia N810, despite being a different thing, it shares quite some things with the iPhone in philosophy, Ars Technica reviewed the thing
As for media players, I like the Sansa e2xx models, the one that f0dder mentions. There are also other alternatives that look quite attractive to me, like Cowon's iAudio
(a bit expensive, if you ask me), or the Meizu line of MP4
, recently brought to my attention in Hydrogenaudio. They are affordable, and pack a lot of functionality
, much like the iAudio. In that field, they're better than the Sansa.
I don't know what to think about the iTouch, though. All the functionality is available in the iPhone, it has a paltry amount of space... to me, it looks like a loser in the Apple line of iPods.
PD: The Zune is also coming to Europe.