Engadget reports some last minute iPod rumours just before the "Let's Rock" Apple media event.
The iPod nano's capacities is set to be upgraded from 4 and 8GB models to 8 and 16GB respectively, while having 9 colour choices, up from the existing 6. However, the iPod touch will not be having any capacity increases, remaining at 8, 16 and 32GB models. Instead, the good news is that prices are expected to fall heavily.
We'll see if that's true very soon, but most likely it will be.
FYI, the Apple online store is currently down, perhaps in preparation for the new products :)