I don't do audio books, but listen to music with earbuds. Hubby has the big iPod (160gb?) with over a weeks worth of music on it and it has hardly made a dent. I love Pandora for my iPhone though!!!! Should be able to download it on an iPod touch too. You can choose a song, group, or genre and it builds a radio station around it for you - and you can rate the songs and it will adjust your station. And on the iPhone there are brief adds every few minutes so you can listen for free (on the computer you are limited each month on how long you can listen with out a paid subscription)
And yeah! What quilting apps am I missing? :D