Touch all the way.

Quicker, nicer interface even if you're just using it as a music player, making it easier to find the music you want. Add on to that all the extra functionality as described above and you're on a winner. The only possible reason for buying a classic these days is if you really need the extra capacity a classic gives you.

No way to avoid the shoddily-written pile of poo that is iTunes to get your music onto either device, sadly, but Touch for the win.