All the latest kvetching is about how the iPod Mini was a complete screw up by Apple. I don't agree. The main argument is that for $50 more, one could buy a 15 gig iPod.
This assumes that everyone bases their decision only on price. If this was the case, we would all be driving Yugos because they are so cheap.
If someone is in the market for a small MP3 player, there are a number of flash-based players for around $200. Most of these have a max capacity of about 256 megs. If I am a buyer who is considering these, now I have a choice where I can spend $50 more and get 4 gigs of storage.
If I am willing to carry around a bigger MP3 player, the regular iPod is the obvious choice.
Just over one year later, I find it amusing that Apple can barely keep the mini in stock, it is so popular.