On the other hand, I resented that I was basically forced to pay up and upgrade in order to continue getting updated versions for applications I had already purchased, as well as buy new apps. I held out until an easy jailbreak was released for 3.1.2.
I agree that Apples reasoning for charging for the Touch updates sounds shady, but you're comparing a touch (NOT a phone) to a nexus one which is a phone. If you compare it to the iPhone the updates are included.
Did you really buy a Nexus ONE to replace your touch and don't use the phone portion of the Nexus?
Of course not. But my choice to buy the N1 is influenced by both my experience with the Touch and my girlfriend's phones, first an iPhone 3G, and now 3GS.
Needless to say, I'm now using a Nexus One.