Deciding Factors for buying a portable audio or video player (aka MP3, video iPod, etc.)

Don't believe all that about iPod formats not being compatible with MP3s etc. iTunes allows you to import MP3 songs and convert them to iPod format. And iTunes can burn an MP3 CD even more easily than most other music programs.
(It's only the Windows world that needs to be labeled "plays for sure". It's all a marketing ploy.)

Consider:
Who are you buying it for & How do you think they'll use it?

Traveling - airports etc. (Zune has wifi capabilities)
Traveling - listen in car-- be sure to get a car kit to listen through the car's speakers.
Athletes (see Nike plus Nano below)
All the time (check battery life listings or think of getting an external battery for them)
To replace their home music library? (you'll want lots of memory.)

Buying factors
Size of memory: do they really like music? Will this become their whole music library to take everywhere with them? (it happens!) --buy as much as you can afford that fits in the size you like. Smaller units may have removable memory 20GB for music only; 30GB or more for video, 60 GB or more for lots of video
Ease-of-use: There's nothing like an iPod for ease of use. One stop shop and easy navigation.
Recordability: audio and video. Will they want to record video off the TV (using it like a VCR) or other devices rather than just downloading programming? Will they want to record audio from an XM or Sirius radio (TiVo style)?