[Halcyon]

Although lots of people are going for the Ipod Mini's, I wouldnt reccomend them if you have a large CD collection. The 512mb or 1gb versions are not good enough if you have a big collection of CD's and you dont want to compress them all to rubbish quality.
If its just to stick the odd few albums to go jogging round the park or for your lunch break then do go for them as in this case they are good.
I agree with you that the EQ on the Ipod isnt great so I just dont use it. With a decent pair of headphones the sound on the Ipod is pretty good.
The only annoying thing can be the battery life but people say the newer ones have sorted this out now. I have a 3rd Gen but it does me fine.
A lot of people I've talked to reccomend the Irivier as I believe it offers gapless playback (eg. if listening to a mix album) too and better battery life.