A co-worker just bought a 40GB iPod Photo over the weekend and I am truly amazed at the little piece of machinery.
At first glance it looks like a standard 40GB iPod but after picking it up and messing with it a little I noticed that it seemed thicker and a little heavier (which it is). Those were not huge issues but something that you just notice is different.
The dock for the iPod came has an S-Video out so that you can plug it into your TV and get 800×600 resolution on your photos (sweet!!).
All in all it seems like a neat little toy. I doubt that I will be spending $500 on one as I am just fine with a black and white screen for half of the price.