Apple sold in excess of 10 million iPods last quarter, most of which were priced above $100. That's in addition to 7 million iPhones.

My own pet theory is that a new device will carry the iPod brand (e.g. "iPod Slate") and take the top price point ($399) from the Touch. They might not sell 2.5 million in the first quarter at that, but I can easily see sales ramping up to meet 10 million if the device is even remotely interesting.