Enlightening so far . . .
My kids use their DS for games, have no need for portable movies or tv (they read or draw or listen to music when on the road) have access to my Nook color for books and internet, have mp3 players for music and aren't allowed to touch my cell phone so running off with it would be out of the question. I understand the portability of an I-touch but I guess I'm in the minority, because my kids just don't need anything that's portable. They have their favorite books, card games, puzzle books, or their parents to entertain them if we are on the go somewhere. At home they have a real tv to watch tv and movies on, a stereo to listen to music, various video game machines to play with and so on. In MY opinion, for a young child the Ipod touch is just an elaborate toy, a luxury, and my kids won't be getting one at this point.
Now having said that, I do know high school kids who use the GPS feature, look up things for school online, etc. so I do see the usability there. Of course a lot of those kids do most of that on their Iphone though so they have the texting and talking capability too.
I have a little friend, 9 years old, she watches movies on her Ipod touch and I'm not sure how she hasn't gone blind the screen is so small! She'll watch an entire 2 hour movie that way. Go figure, my old eyes couldn't take it.
So, your kids don't need anything portable...
Except their DS, your Nook, and an MP3 player.
Sorry, but you are contradicting yourself (and make no sense). The iPod touch is a "luxury" to you, because your kids already own (or have access to) many other "luxury" items that cover many of the uses of the iPod touch.