Alright, all the details are out.
http://www.apple.com/ipod/ipod.html
Yes, it has Video Out.
The $399 model has a whopping 20 hours of music playback battery life.
It's THINNER than the previous iPod model.
H.264 video: up to 768 Kbps, 320 x 240, 30 frames per sec., Baseline Profile up to Level 1.3 with AAC-LC up to 160 Kbps, 48 Khz, stereo audio in .m4v, .mp4 and .mov file formats
MPEG-4 video: up to 2.5 mbps, 480 x 480, 30 frames per sec., Simple Profile with AAC-LC up to 160 Kbps, 48 Khz, stereo audio in .m4v, .mp4 and .mov file formats
Apple has begun selling TV shows, starting with 5 ABC and Disney shows, and 2000 music videos, on iTunes. No Smallville or Star Trek yet
This is actually very good. It's still $299. Yesterday, $299 got you a 20 GB iPod that plays music and displays photos and has TV out. Today, $299 gets you a 30 GB iPod that does everything the old model does, plus plays videos, and still retains the TV out.
I wouldn't want to watch full length videos on the small screen either. TV shows on the other hand I wouldn't mind, being shorter; AND the TV out would be useful for full length movies, as you could stuff the videos on the iPod and hook it to your TV.
And it has H.264 support
All Apple needs now is a way to rip DVD's that applies a DRM in the process so the movie industry doesn't kill them.
IMHO, the PSP's UMD's are a terrible idea- unless they add TV-out to the PSP.
Thing is, you can actually put full movies in this thing. Compare to the PSP; $20 for a UMD movie. If you want to STORE movies, a 1 GB Memory Stick costs $150. That's $400 for a PSP with 1 GB of storage.