Please note the pictures I include aren't mine, they are from various sites around the Internet. I didn't take my own pictures because a) I'm not a good photographer and b) there are already hundreds of pictures of the new nano.
Aesthetics
Ever since the infamous "spy shots," people have been rather vocal on their opinions of the aesthetics of the 3G nano. Given lovely baby names like "fatty," it's certainly no surprise that the 3G nano is in fact a bit wider and shorter than the previous, second generation nano. However, this is a product that you won't appreciate until you see and hold it up close. Pictures, especially those on Apple's site, can't portray just how thin this thing really is. While it's actually no thinner than the second generation, it appears to be due to its rounded design. The design is really very beautiful, it looks exaclty like a miniaturized, but perfectly proportioned, iPod classic.
One interesting thing to note about the 3G nano specifically is that it combines the style of both the first and second generation models. The back is the classic stainless steel, seen on the iPod classic and first generation iPod nano. The front comes in several colors, and is made of anondized aluminum, just like the second generation iPod nano, the iPod mini and now the iPod classic. (I guess it'd be easier to say that all iPod models now have anondized aluminum fronts. Yes, even the tiny shuffle.) This, obviously, signals the end of the "white plastic" era for Apple. (As the MacBook is the only Apple product to still use transparent white plastics.) While some liked the old look, there is no denying it attracted dirt and scratches like crazy. Anondized aluminum is perfect for the front of the iPod nano, as it is considerably scratch-resistant, and does not get nearly as dirty. Unfortunately, the 3G nano continues to use plastic inlays over the display, instead of the higher quality optical glass used on the iMac, iPhone and iPod touch. This means that the inlay can and will get scratched.
What actually received a good deal of controversy are the new colors. Yes, they are changed, but no, they aren't ugly. In fact, they look rather good. Again, please don't make your judgment based on what you see on Apple's site. Once you see them up close, I think you'd agree they look nice. The new colors aren't as loud as before, going for a more professional, but still relaxed, look. The new (Product RED) nano looks especially nice, trading cherry red for a darker, muted red. I personally like the black casing the best, and I think black has in fact made the greatest leap. Instead of being a true black like on the first and second generation models, the third generation sports a lighter, "graphite" black. When you see the product straight on, it does appear black, but glance at it from any angle and you'll see it's quite a different story. It more or less looks like the "BlackBook," and I think it's a very nice shade, a mix between stone gray and true black.

Since the introduction of the new iMac back in August, Apple has made a great deal of effort to design their products with the environment in mind. This new philosophy can be seen in the aesthetics of the nano. Save the already mentioned plastic screen inlay and obvious click wheel, the nano is an entirely metal construction. Even the hold button, now moved to the bottom of the unit, has been built out of aluminum. This means when your nano finally dies and goes to iPod heaven, you will be able to very easily recycle the nano and help make a new one.

User Interface
Other than the new design and aesthetics, this is the most obvious difference between the new and old nano. The new user interface is a "remix" of sorts, in that it doesn't really add anything new, it just presents old options in new ways. One thing to note is that it features all new icons, from the Apple logo upon booting to the battery icon when charging. Another interesting point that is not immediately obvious is that the new user interface references Leopard. Many of the old Aqua elements, like the scroll bars and progress meters have been removed, replaced with dynamic, flatter elements, just like what's seen in iTunes 7 and Leopard. (When I say dynamic, I mean that you won't always see a scroll bar like you did before, it will only appear when necessary.) Another relatively minor change is the typeface. The original monochrome iPod used the classic Chicago typeface, while the color iPod used a derivative of Myriad Pro known as Podium Sans. The typeface has again changed with the new iPod nano. This is best noticed by looking at the numerals "6" and "9." You will notice that the tails are much more rounded than before. I believe the typeface may be Lucida Grande, but I'm not entirely sure.

The "Now Playing" screen has seen some changes. The album art is no longer displayed at a two-dimensional angle, but now has an angled, three-dimensional look to it. This is similar to what you see on TV. The album art also has the "mirror reflection" seen on Cover Flow and Leopard's new Dock. In addition to all this, scrolling effects are much, much smoother than before. When you have a long song title, it scrolls very cleanly to left so you can read the whole thing. While this isn't new, it always looked very rough on older iPod models. But now, it's as smooth as butter. No rough edges, no seams, it's more or less perfect. Unfortunately, long artist and album titles still don't scroll. Though it'd be distracting to have three lines of scrolling text, it'd still be useful, especially when you have artists and albums with similar titles. Note that the song title is now displayed in a larger typeface than the other information, as well. Lastly, song ratings are now displayed on the screen, as well, just below the artist listing. You no longer have to toggle through three other menus to see what you've rated a song, although you still have no way of actually changing a rating directly from the Now Playing screen, something that would have been nice.
And of course, there is Cover Flow. It's bit slower than what you'd see on iTunes 7 and the iPhone, but works exactly the same way. You can scroll slowly or quickly through your album art, then press the center button to flip the art over and see the track listing. It's more eye candy than function, though. It's still easier to just browse the old-fashioned way or use the search function.
Unfortunately, being a new user interface on a new product means that it's slow and buggy. This is best seen with Cover Flow. Even scrolling at a slow pace will often freeze the nano for a split-second while the art loads. To be fair, the nano is overall quicker than the iPod classic due to the faster flash memory, but it's still noticeable. As for bugs, there are a few that I noticed. For example, when playing the game Vortex, the current song that was playing would stick for a brief moment and then play on. This also happened when scrolling quickly through Cover Flow. The good news is that most of the UI imperfections can be fixed with firmware updates, and I wouldn't be surprised if one was released soon.

Video Playback
Some may be wondering what the nano actually can do technically that it couldn't do before. And that just happens to be video playback. Yes, now you can watch your movies on the tiny nano, as well. While the nano features an even smaller screen than the classic (just 2'' wide), it squeezes in the same resolution featured on the classic, 320 by 240 pixels, at a depth of 204 pixels per inch. What this means is that what you see on the classic will look exactly the same on the nano. Of course, the screen is still smaller, so if you're concerned about eyestrain, take caution. The 3G nano also features a brighter display than before, which really makes video look good.
Being able to play video is a bit of a dual-edged sword, though. While it was a long requested feature, at the same time, keep in mind the nano only is available in 4 GB and 8 GB models. Even a brief 90 minute movie or 30 minute TV episode can take up massive amounts of space. Thus, video playback really isn't all that pratical for someone who already has a rather large music library. Think of video as more of a bonus. If you were hoping to be able to store your entire music collection and your movie library, you're out of luck. Hopefully the nano will eventually be available in larger capacities in the future, such as 16 GB or 32 GB.

So, is it worth the price?
Consider that both models of the nano are now $50 cheaper than they were three days ago. Consider that on September 4, a 8 GB nano set you back $249, now, it's been reduced to just $199. I can't recommend the nano to anyone who is serious about listening to their entire music collection, as the nano simply doesn't have the space. But, thanks to the durability of flash memory, the nano is much better for things like running, jogging, etc. While many people do have large music collections, most rarely listen to everything. The nano is great for loading your most frequently accessed playlists, artists, etc. and a few movies. Of course I don't recommend the 4 GB model, especially as you double your space for just $50 more.
Overall, the third generation iPod nano has improved upon the second generation model in some big ways. I think it's well worth the price, especially as competing flash players simply aren't as elegant or simple to use.
Thanks for reading this review, I will keep it edited and updated it as I continue to use the 3G iPod nano.

