The iPod Touch only supports 802.11b and 802.11g wireless. There'd be no benefit in an "N" router if it's only being bought for the iPod.
If you're planning to eventually use other wifi devices such as laptops, then a "N" router might come in handy in the future. However, when even a single "G" or earlier device coexists with "N" devices, the overall throughput for all devices on the network will degrade somwehat.
Right... I think cost is the major driver. It seems like there are numerous cheap 802.11n routers out now -- like $30-50. You can get an 802.11g router for $20-25 if you shop around, but that's really a minimal savings. Definitely do not spend much more than $30 for an 802.11g router, unless perhaps it's a really nice one (like a used 802.11g AEBS).
The iPod Touch only supports 802.11b and 802.11g wireless. There'd be no benefit in an "N" router if it's only being bought for the iPod.
If you're planning to eventually use other wifi devices such as laptops, then a "N" router might come in handy in the future. However, when even a single "G" or earlier device coexists with "N" devices, the overall throughput for all devices on the network will degrade somwehat.
Some routers (usually "hybrid" or "simultaneous dual band") allow you to create two distinct access points, typically one at 2.4 GHz (compatible with 802.11b/g/n devices) and the other at 5 GHz (compatible with 802.11a/n devices).
If you don't use any "A" devices (they're fairly uncommon in North America), and you instruct your "N" devices to only attempt to make use of the 5 GHz access point, then any "B" and "G" devices which may occupy the 2.4 GHz access point will be out of the way, and the N devices would be able to reach their full potential speed.