I have a 16 gig iPhone and am able to keep at least 5 audiobooks (big ones, unabridged) on it at at time along with my kindle, ibooks and nook books, several hundred songs, all of my apps and the phone. I rotate my audio books through iTunes as I finish them. I still have space to store a bunch of photos too.
I love my phone, and have the iPad and Mac book pro as well. I am allergic to windows (seriously, my husband hates it when I use it, as I am very talented at crashing it all the time)
:-)