This story is a sad one. The iPod Touch 3rd Generation didn’t get a camera. Why you ask?
Steve Jobs said to the New York Times that it was “a matter of cost, and we were really focused on the $199 price point”.
While reports from the factory indicate that there were manufacturing problems with the product. The new iPod Touch does have room for the camera, so it’s a true mystery why it’s not there. Gizmodo points out that maybe the Nano’s camera wouldn’t be good enough, and that it would only cheapen the product.
Either way, since there is room, expect Apple to be putting a camera in there SOME time. Eventually.