Well,
I've heard the 3G ipod, the 4G ipod, the 5.5G ipod and the 1G nano and to me they all sound bad. very thin and flat. There's also not much of a soundstage in them. It's (as always) a personal opinion. But I've certainly had better Dap's. Like Sony HI-MD units, sony Walkman series (NW-A805 NW-S703) and Cowon players.
The SNR is very good. The sony have a bad SNR indeed, but the Cowon shines with a Wolfson DAC, telechips SoC and thus a 95dB SNR. But it's not just that. It's the combo of DAC, SoC, Circuit, AMP etc. to get good SQ. (Cowon D2 has 74mW AMP) The older ipods just didn't sound the way they look and handle. And I've always considered that a shame. Especially with the new touch. It's a great device, hopefully with good SQ.
greetz