Just caught the end of the Apple keynote, and they did indeed launch the iPod mini. I found it odd they compaired it to the Rio Cali 256 flash unit and not the Nitrus.

The iPod mini is a 4gb player, not sure what hard drive it uses. $250 price, USB2 and Firewire, same dock connector as the bigger iPod. Size was compared to a buisness card, thickness of 0.5 inches. Ships next month to the US, April worldwide. Same interface as the iPod.