I got my Ipod Touch 4th gen 32 GB at launch day. The 1st time I listened to it, I noticed a punchier bass than my 1st gen touch. I am using my Denon C551 for my comparison and it has strong bass to begin with. I am happy with the sound improvement, but notice that I am comparing 1st gen and 4th gen, I am sure 1st gen and 2nd or 3rd gen will be different sound wise. For EQing, I don't normally use EQ on my 1st gen touch because the sound will be distorted and the EQ suck in general. But, I tried using EQ for my 4th gen when using Ibud (that came with the player) that I put into my case as a back up. I found that using EQ in my 4th gen does not distort the sound and the sound of the EQ seems different from my 1st gen (using the same EQ setting). So, I believe that they improve the EQing in the 4th gen.
Feature wise, the 4th gen for sure is slimmer and slicker than my 1st gen lol. It also has better screen resolution which I love so much (I don't even have to zoom when browsing to this forum, I never able to do that with my 1st gen). The speed when browsing has also improve a lot (again I am comparing 1st and 4th gen), web pages open faster, scrolling also smoother, clicking also more precise. People complain that the screen is not as good as the Iphone 4 and that's true, but I find it actually better. The screen will become washed out when seeing from an angle, but it is not that bad (same like watching TV with LCD HDTV compared to Plasma), when seeing directly it's great. I find this to be better because I don't want people to see what I am doing when using my Ipod and even when you showing something to your friends, the most will be 2-3 people, so no problem for that.