I am digging the Mini!
If they can keep this size and stay with this wheel design (and, of course, get the capacity up to a reasonable 20-30 gigs ) then I think Apple will have created the definitive MP3 player.
Let's face it - you really don't want to go much smaller. You WANT to feel something solid in your hand. And I must admit to a 2g bias as to the wheel design (didn't much like the 3g's buttons - too sensitive) and it's "one thumb" approach. The mini nails these two design areas! The thing feels great in your hand. It's sturdy and gives you the feeling that if you do happen to drop it that your not really gonna hurt it. The wheel is responsive and sturdy. It doesn't give the impression that it will wear out anytime soon. And it retains the same functionality as the 1 and 2 g's. The screen is MUCH nicer. The fonts are crsiper. Overall, it reminds me more of a cell phone screen. Clean and bright.
Apple has done another awesome job. While it is not a "must have" like an iPod, it definitely has it's place and is a great insight into what is coming down the road. I hope they continue to move towards the Mini for personal audio hardware. And, as other people have suggested, take the iPod further into the personal multimedia player area.
Man - are we lucky are what !!

