That's a good question. Let's break it down into pieces.
Price
------
UMDs (PSP) are about $10-$15, but since they're physical, you can buy them used for about $3. (BETTER)
iTunes: $10. Period.
Compatibility
------
UMDs are for PSPs. That's it.
iTunes movies work on your computer, iTouch, iPod, and iPhone. (BETTER)
Simplicity:
------
UMDs have to be watched one at a time on physical cartridges, meaning you have to bring one for every movie you want to bring.
With the iTouch, you only have to bring one thing: your iTouch. (BETTER)
Screen Size
------
PSP: 4.3 in wide (BETTER)
iTouch: 3.5 in wide
In my personal opinion, iTouches are better, but ultimately, you decide.
no an ipod touch is better
Yes, an iPod Touch is better than an RC car (in my opinion).
Ipod classics can play movies and songs and has more memory than the ipod touch.
The 3rd generation is better than the 2nd generation of iPod Touch.
an Xbox 360 is better than an i-pod touch
no
The iPod Touch 2nd generation is better than the first generation. The 2nd generation is slimmer, lighter, has a faster processor, and is overall better than the first generation.
Definitely iPod touch. It's way better than a parakeet.
YES by far, the ipod touch has waaaaaaay more features and its touch screen with built in speakers
If you ask me the iPod touch is better because you have wifi and apps with the iPod touch. If you get the iPod nano you cant do anything but play pre-loaded games and play music. The iPod touch is 1 step down from the iPhone.
Iphone?
Definitely not.