Two words. "Natural Consequences"
The natural consequence of losing the Touch would be having to tell you and Dad about it...and then going without until she earns the money to buy her own. You've already bought her one, and she didn't take care of it. Don't buy her another one that she's also not going to take care of because you'll replace it anyway.
I think it's a parent's responsibility to show children the "real world" and how it works, so that when they're adults they know how to live in it...
Aaaaaaaaannddddd....I'd want to buy the new one too, and save her from having to tell Dad! ;) :lol: I wouldn't, but I'd WANT to!!
**ETA** I see that I posted after you posted that the Ipod is back where it belongs!
My next advice, since I'm really good at handing out advice, ;) :lol: is to make her tell her Dad about it!