Depends what type of music you're into.
As for free apps, I find paper toss pretty fun, i also use the facebook and window live messenger apps a fair amount. There's also an xbox live friends list app, but all the PS apps are crap. There's also an app for spotify premium users where you can use that app to access you're spotify account, so you can have all your music on a spotify playlist and access that on your ipod without taking up all the memory. Also apps like "cool wallpapers" and "88,000+ wallpapers" are both free apps that you can use to cool backgrounds for your ipod.
If you want some more I can probably find some more usefull or fun apps fairly quickly.
~DS