We have one of the white 20GB photo iPods....and use it the following ways:
- I use the iPod almost exclusively in the car....I have about an hour commute each way to work, and have discovered the joy of listening to books while on my journey

Since my car does not have a tape or CD player, the iPod works great as a substitute for these!
- My DH uses it mostly at home, playing it over the stereo or taking the dog for walks...he's more of the music listener than books though
- The last, and one of the most exciting features we use our iPod for is to clear the camera card off when we're on vacation! I used to drag my laptop with me on vacation just so I could clear the camera cards (yes, I know you can buy more cards...and we already own two 256MB ones, but seriously, you have no idea how many pictures I take!

I would be spending a fortune on cards!). Plus, I seem to have anxiety about not having enough space, and I would just be nervous on long vacations without having SOME method of clearing off those cards....the iPod is a great alternative!