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Other than that, there is some truth in the idea that the physical buttons/scrollwheel of the Classic is easier (er, possible!) to use without looking at it. That is the one single thing I have found a little annoying, as I listen to podcasts at night in bed a lot, and if I want to fast forward or pause then it's annoying. It is something that is alleviated a bit by getting a remote for the headphones (I bought the Apple ones with the mic/remote, which lets you pause and alter volume and skip tracks forward/backwards on the right side of the headphone cable).
Despite that though, apart from the slightly easier audio controls and greater capacity the iPod Touch is just FAR superior in every way as far as I am concerned. Apps are fantastic. It plays games, and runs all kinds of great stuff. Mobile safari is great, it plays videos really nicely too.
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There is an App in Cydia called PocketTouch that makes it easier to use the iPod Touch whilst in a pocket or driving. It turns having to click on buttons that could be anywhere on the screen to just simple swiping up, down, or across.