I disagree. As far as I know, Apple has never used the 'G' designation for iPods, it seems to be a label that we've come up with on the forums. Apple's CPU names (G3, G4 etc) mean 'Generation 3' and 'Generation 4.' Surely a generation 3 iPod should therefore also be called a G3.
On a slightly more personal note, I've mixed things up occasionally when people say they're having problems with a 4G iPod - I sometimes read that as 4 GB and assume they're using a mini. Saying G4 will avoid that confusion.
So, what do you guys think about this?