The Gizmodo verdict on the January update is that its worth it…
Regarding the $20 charge, they, like many others, miss the point when they say:
anyone who paid $399 for a first-gen 16GB touch especially can spring for the extra Jackson.
Also, they gloss over the poor handling of the deployment of the update when they say:
If things don’t work out just right, don’t panic … uncheck “Manually manage music and videos”—you might get an error message … but still, it will sync the new apps…
Yup, $20 for old software that is a hassle to sync. Sure sounds worth it to me.