I dont upgrade cuz supposedly Apple makes it fuck their older devices up so they'll want to buy the new iTouch5. I'm happy with my 4...
Each update slows my iPod down..... Makes it crash a lot more and resets on its own.... Doesn't do it before updates..... They just want to screw anything older than iphone/pod 5 so we'll want to buy the new ones. No thanks. I'm happy with my 4.
3.1 just to upgrade and then you're all set it only takes up 718mb of space but it replaces all of iOS 6 stuff so it's not additional.
Updated mine yesterday and I love it I went from an android to an iPhone and it looks nothing like android.