The new Nano's display is slightly larger than the old version's - it's 1.5in diagonal - and it's certainly brighter, something that folk who plan to keep photos on it will appreciate.
The new search system is a joy to use. It reminded me of entering my initials in old arcade games: just select a letter and hit the click-wheel's centre key. Like Mac OS X's Spotlight search system, as you add more characters, the Nano narrows the search. And to avoid confusion, artists and albums are flagged with an appropriate icon to separate them out from the song titles.
My gut feeling is that this feature will be less useful for obsessive music fans than it will for more casual listeners - the former will know which album and genre a given song is filed under and track tracks down accordingly. Everyone, though, will find the new scroll guide of benefit. Zip through a long list of songs and after a few turns of the click-wheel up pops a large panel indicating the point in the alphabet you're currently scrolling through. It's much easier to read than the initial letters of the scrolling song/album/artist/genre/composer entries are.

The big benefit is the battery life, now boosted to 24 hours - ten more than before. While you might not sit down an listen continuously for a full day - maybe not even the 14 hours the old Nano could run for - the higher capacity means you'll not need to worry so much that when you pick up your player before heading, you'll suddenly find it dead.
The arrival of the 8GB Nano has pushed the old 1GB capacity off the list, but the prices are the same, so you're now getting more capacity for your money or - if 2GB or 4GB is plenty for your needs, a cheaper player. Apple hasn't lost its product pricing guile: if you want a black model, you'll have no choice but to spring for the 8GB Nano, and if all you want is 2GB of storage, you're going to have to have a silver-hued device. But that's the ruthless efficiency of Apple's profit-loss spreadsheet for you.
Of the three capacities, 4GB remains the sweet-spot - that 1,000-song limit is perfect for the majority of more casual listeners. Folks looking to keep photos on their Nano too should opt for the 8GB model, I'd say. The screen seemed more scratch-resistant too, but after only a short play, it's impossible to say so with certainty. Again, time will reveal how well Apple has designed the display's plastic shield.

If you already own a Nano, there's little need to upgrade. People who don't have an MP3 player are certainly not going to be disappointed. The absence of an FM radio is its only drawback.
Will the metal shell prove more robust that the metal-and-plastic first-generation Nano? Only time and usage will tell. The matte metallic casing shows up grease, but at least it's easier to clean without fear of scratching the surface.
Verdict
The new Nano is certainly more iPod for your money, and there's no doubt that, feature-wise, it's a big improvement over the first-generation model. Me, I prefer the look of the old one, but if the popularity of the multi-coloured iPod Mini is anything to go by, I'm firmly in the minority. ®

Apple's second-generation iPod Nano
COMMENTS
Over-priced, Over-hyped
The Armani or Dolce & Garbana of MP3 players - Apple have done a great job of selling the Emperor's New Clothes, and now updates that are slightly incompatible with some [many?] existing accessories. One has to congratulate them on not only their ingenuety at [their own] wheel reinvention but also their marketing skills - very Japanese-must-have-the-latest-and-greatest-update.
I'm steered to almost any MP3 player but Apple by this latest update.
FM Radio? yours for only...
Apple has 'solved' the FM radio question with a reported decent add-on radio attachment that doubles as a remote. The 55 euro contribution required will make sure the iPod money keeps on spinning in.
Just more of the same
It seems to me that to make the product financialy viable Apple need a constant stream of upgraders; endless minor improvements to make the gullible fools who read Stuff and T3 to part with their cash. They really are at the minor end of qualitative improvements -- all, if you ask me, a desperate grab to try and sell the idea of MP3 players of not being a commodity device. Sony tried this with the "Walkman" in the 80s and failed completely. When you can buy a 2GB MP3 player for £50 or less, the days of paying premiums for these players is clearly numbered.
Pricing
Personally I think the Nano represents great value for money - however for the price of the 8gig version you can get a full blown 30gig video iPod - so I'm not sure I see the point, also it only seems to be available in black.
The other thing is the 1gig version, which I find most appealing due to my simplistic needs, has not been replaced as yet.
I'm struggling to see the point of the change though. It's still an iPod Nano, only it's shapped a bit differently. Is the screen less susceptible to scratches? Does the battery last a bit longer? I suppose new technology could benefit both those issues.
What would be cool is if the Nano incorporated the video feature of the larger iPods, but as it only has a 1.5 inch screen I can see why this hasn't been done.
The point of making it available in different colours? I'm not sure, because it still seems a bit flimsy to give to kids, the only "demographic" that would truly care what colour an mp3 player is. Whether the fact you can get it in blue, pink or green would convince those 3 people that don't like them enough to jump on the bandwagon seems somewhat unlikely.
No wow factor
The new Nano really does feel and look like a Mini that breathed in. I like that Apple generally makes a either a big step forward or chooses not to fix what isn't broken. Unfortunately, if you go to find a new Nano with a sense of anticipation, you might feel somewhat disappointed.
