Excellent points. Actually, what I would do (unless you have an extremely good set of headphones) is convert into MP3 320k. It is far more compatible, that is if you are going to convert. I say MP3 knowing the crowd but also knowing that ALAC is quite proprietary. If you want wide spread audio support and FLAC isn't an option, mp3's are the second best. Almost everything will play them, even Apple but I swear that Apple employees shed a tear every time an mp3 is played on their device.
I suppose what I was bringing up is that if you have a large library which is all FLAC, spending 40$ to get a 4GB player isn't unreasonable. You might have one that works, but you can get a Sansa Clip for so short money that spending hours converting your stuff might not be worth it.
I have almost exclusively FLAC audio. To convert my collection to anything would take days. Don't discount the Sansa. It is only 40$ and the sd card can be twice that or more, but that little player really kicks ass. Getting 70GB of stuff on my tiny clip is awesome and for about 80$ too. I was greatly surprised by it, and for the money, you can't beat it. The expansion slot also means that you can get what apple charges $500+ for about 100. Besides, 70GB of audio is a ton. Yea, it isn't as large as 250GB players, but it is really quite large.
The UI is a bit tiny and the buttons are too small and if you require the apple UI, which admittedly is awesome, then perhaps spending the time to convert everything might be worth while. If you are using your player for commuting or working out (like I do), the clip kicks ass. It is small, sounds excellent, and the UI isn't total garbage. Basically, I would keep it as an option, if you don't want to convert everything from FLAC. Only apple doesn't support FLAC. I might keep that in mind when you want or need a new player.