I personally wouldn't pay $99 for an iPod for its PRIMARY use. As a FW HD, perhaps I would. But, not for just the music capability I wouldn't.
Who can afford 1,000 songs nowadays?
I remember when CDs came out in 83 while at McCutcheon hall with a friend who just got his new Yamaha (remote-less) player for $500. CDs were starting out at about $13 - 15 IIRC. That was about equal to the good high-quality vinyl being put out at that time.
BUT, the promise was that CDs...