I'm on my third 4G iPod 20GB, as of 10 minutes ago. The second one, I got back in October when I dropped the first one on a marble floor. But, last night, it died when it took a header out of my pocket and bounced off the parking lot pavement. Last time I used a mailer and sent it back to Apple for replacement - but this time, I just drove straight to the Apple store. The Genius Bar denizen took one look at it, held it to his ear, and said "I'll be right back." A few minutes later, he returned from the back room and handed me my third iPod. It's syncing podcasts now and reloading music from my home server.
I've got to say: I don't think I'll ever get an Apple product sans-AppleCare. I'm probably very tunnel-visioned at this point, but I can't imagine getting this sort of service from another gadget company. Over the past few years I've gotten a few replacement hard drives, a new keyboard and assorted keys, and now two new iPods - all covered by AppleCare. I'd say the cost has been covered.