I updated my iPod Touch last night to 2.1 using the manual process. Like I've posted here before ad nauseum, I've had significant problems with the 2.0 software on my iPhone; less on my iPod Touch. Still I really wanted this as soon as possible.
The update process is pretty quick. I've been restoring my iPhone a lot lately so I am used to the process. First it updates your firmware, then you pick which profile you want to use and it uploads your user information. Each step takes about 5-10 minutes.
I have 3 pages of applications, so I am taxing this thing a little bit. The first thing I noticed since the update is that going between applications is much faster. This is how it should be clean and speedy. I think Apple sped up the transitions. The switching on my 2.0 iPhone is clunky by comparison.
Apps load up significantly faster as well. Nothing insane, and big apps still take awhile, but you'll notice some additional speed.
The big difference is syncing. The iPod only takes a few seconds to sync if there has been a recent sync, and if you've added something like a new song or application, it is much, much, much quicker than it was before. Backing up took only a minute compared with 20 minutes or so before the update. I think Apple might be doing incremental instead of full backups now.
I was kind of hoping to get the "shake to shuffle" feature that is on the new iPod Nanos but alas, it wasn't to be true - at least not yet. I can also confirm that there is no hidden mic-in port on old Touches a feature that exists on the new iPod Touches. No VoIP for me.
One thing that I do notice is that podcasts that have been listened to in the Music application have half circles on them in the iTunes store, where before there was no indicator of whether they had been listened to or not. A feature!!
Actually there are a few new features thrown in. The Genius playlist, which I haven't, quite frankly, totally got my head around is there and able to recommend songs based on what I listen to.
The main thing that wasn't thrown in - with no mention from Apple - was the push notification that it promised at the WWDC. Maybe 2.2? Hopefully; I know I am not the only one who can't wait to get my hands on this. It will make true instant messaging as well as many other applications a reality.
Overall, however, 2.1 is a bugfix and optimization release and not much more. Exactly what it needed.