It went unadvertised in yesterdays Apple event, but the cost of upgrading from OS 2.x to the latest OS 3.1 (for your iPod Touch) has now been reduced to just 2.99 pounds.
Please do not vote cold just because you think this should have been a free upgrade in the first place!
To upgrade to the latest OS 3.1 you will need to connect your iPod Touch to itunes and you will be prompted to upgrade when you click on the device and then click "check for updates".
I think the upgrade from 2.x to 3.1 is well worth the upgrade, especailly at the now reduced price. For the full list of new features with the upgrade from 2.x to 3.1 check here - http://www.apple.com/uk/iphone/softwareupdate/
PS: Here is a link showing the new price (in print), but obviously iTunes will also show the same price when you update - http://www.pocketgamer.co.uk/r/iPhone/Apple+iPhone+30+software/news.asp?c=15471