I've been carrying a PDA continuously since the late 1990's, starting with a Palm Pro, graduating to a Palm T/X before switching to an iPod tOuch. The touch was primarily used as a PDA.
Until about 6 months ago, I carried a plain dumb cellphone, usually some sort of budget phone since I rarely exceed 100 minutes a month, even without a home phone. I have gone with Virgin Mobile--they had the best deal when I started with them, and their service was cheap enough that I wasn't compelled to look elsewhere. Not long ago they started offering featurephones (internet and email, but not very smart)--more minutes than I'd use, plus unlimited text and internet for $25 per month, with no commitment beyond $80 for the phone. It worked as advertised, but not particularly well--adequate for phone, light email and an occasional emergency Google search, but between the tiny screen and a bad user interface, web access wasn't particularly useful.
I finally decided to combine both functions and get a true smartphone. I did not spend extensive time researching the absolute best possible phone, but Android was obvious, and it appeared that T-Mobile did the least crippling of its Androids, has coverage where I spend my time, and I'm a heavy user of Google products already. Their G2 Google phone seemed like a good fit. They also had a promotion where unlimited internet and text (and 10 times more phone minutes than I'm likely to use) were at the upper end of my monthly budget.
Comparing hardware, the iPod 4g has a slightly better screen, both in visual and touch sensitivity. The G2 has a hardware keyboard, a much better camera--5 megapixel with autofocus and a somewhat useful flash, but no front mounted camera. The keyboard is considerably better than the one on my featurephone, and miles better than a software keyboard. Of course the iPod is much less bulky, but that's a bit apples to oranges, I'm not familiar enough with the iPhone to compare.
Apple usually wins on polish of the user interface, but Android is extremely good--I think they are equal here.
For openness, letting me do what I want, the Android wins, hands down. No iTunes necessary, no waiting for someone to break the latest iPod scheme before I can manage it in Linux. The G2 shows up as a removable drive on Linux. If I want an mp3 as music, I drop it in the music folder. If I want to use an MP3 as a ringtone, alarm or alert, I drop it in the ringtone, alarm or alert folder. If I want more storage than it comes with I can replace the Sd card, up to 32 gig. I can delete songs right from the G2.
The web browser is based on Chrome, and works as well as the iPod's excellent browser, except with Flash support available.
No built-in spellcheck on the G2, a glaring omission.
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