It's awesome. Does some light 3d gaming... maybe not what your ipod touch can do.
There are some great 3d titles that run great, like Raging Thunder II and Exzeus Arcade.
Here's a video of Raging Thunder II:
YouTube - Raging Thunder 2
But those gameloft games... you're better off on the ipod touch unless gameloft decides to do something about them.
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Anyway, feature wise... you won't look back.
Voice to text, voice search, voice integration everywhere...
Different keyboards to try out if you don't like one... keyboards like Swype make me forget about every keyboard I've tried out before.
Apps like Ringdroid are everywhere in the market... just gotta look. For example, this app can take a song and make a ringtone out of it... ON YOUR PHONE, all on the go.
Camera has so many features as well... You can change from normal to sepia to grayscale to aqua, etc... you can change color balance and iso balance and saturation... and lots of stuff.
Browsing is unreal. The screeen real estate makes me forget that I could browse on my laptop instead. I just wish the screen was 16.7 million colors, not whatever color thing they have now... it's less, all I know. So unless you turned up brightness like me, you'll be thinking the screen is washed out. Since I turned up brightness to around 50%... I don't mind.
So featurewise, Android is PACKED.
Customization is also unparallelled. Icons, widgets, you name it... and you have 7 homescreens to put them on. Oh, and can't forget about live wallpapers.
Navigation around the OS is difficult at first... but very easy after a while. If you find going to settings difficult, do what I did... make a homescreen dedicated to widgets that go to battery settings, control wifi, control 3g, control brightness, etc.
Android is evolving. If you mind an okay gpu and the 30fps cap (hopefully gets fixed), you're fine.
Also, battery? Gets me through 6-8 hours of heavy usage... that includes lots of 3d games and browsing and whatnot.
Moderate usage goes for about 10 hours...
Light usage is like 16 hours + ...