Looks like I got the wrong end of the stick, as did a number of others I speak to or read their blogs on the net.
The update to the iPod touch is indeed free but the applications are charged for.
This is fairish, still a bit peeved that new purchasers get them for free and even if your 1 day before the Apple store has a new one in stock your screwed.
But at least updates and fixes are free.
There should be a 30 day fair and honest policy that will give people the upgrades for free at Apple but they are currently in Microsoft lets generate as much revenue as possible at the expense of our loyal customers mode. Never a good mode to be in. Being fair needn’t cost much but will reap many rewards. It probably costs $50-100 to attain each new customer so each one lost needs to be replaced, and that is the cost in my opinion.
Anyway I am more happy-ish.