Let me start by saying I love the industrial design behind the ipod nano. I just bought one and am eagerly awaiting its arrival so I can run it through its paces. But now I'm learning that there may be significant concerns regarding the engineering and ease with which it can be damaged. The Register, MacIntouch, Apple's Support Groups (a 291 thread discussion), and a new site called "FlawedMusicPlayer.com" (formerly ipodnanoflaw.com) all report on failures, the latter of which is posting pictures of others' broken ipod Nano's.
I won't pass judgement, particularly until I see it myself, but it sounds like there's a lot of unhappy folks out there and some frustrated Apple store employees dealing with the returns. Here's to hoping I'm not one of them when my Nano arrives next week.
Disclaimer The opinions expressed herein are my own personal opinions and do not represent my employer's view in any way.