The classic is probably still profitable. The factories are pumping out as many as they need. They serve a high-capacity need that can't be fulfillled by the touch yet. As long as all that's true, I think they'll keep pressing them and shippin' 'em out. Why not? I bought one this year, and even though I have a 3g touch and I'm getting the 4g touch, I'll never get rid of that classic. It pwns the touch for the car, taking the dog for walks, and for resting, falling asleep to music.
Did I actually just say "pwns"?