Apple Thoughts: So There is Room for a Camera

"The iPod touch may be nearly the same on the outside, but inside, it still got a few updates from Apple. The 32GB iPod touch now sports hardware to support 802.11n and even leaves room for a possible camera."

So there is some room in that device after all for a camera. But wait, that's not all! They also appear to have put in a newer chipset that supports 802.11n, although the software isn't out yet to support it. You can see the sequence of photos on the tear-down at the iFixit site.