An iPod is really a whole music system and the iPod is just the part that goes where you go.
iTunes is really the whole front end to it. Most of the major music companies are selling through it and buying music is simple and cheap. You can even
copy and paste URLs to share with friends. Using the
Airport Express music can be streamed to your home stereo plus it becomes your WiFi network. Then when you leave home you just take all your music and playlists with you using your iPod. The iPod can also sync your address book and calendar plus store notes and can also be used as a drive to move files around.