I'm not Lynn, but I read fanfic on my iPod touch. We have a wireless network in the house and I love that I can lay in bed at night and check my email and read fanfic. There are a couple of disadvantages: the screen is pretty small, and when I read a long fanfic I frequently bump the screen in the wrong place and it jumps back to the top of the web page and I have to scroll all the way back to where I was. (Anyone know a fix for that?) Another disadvantage is that it only lets one app stay open at a time, so when your email links to a web page you have to keep switching back and forth between Safari (the web browser) and your email program. But it does save your place for you in each program. I also have a couple of very inexpensive apps that let me download files from the archive and take them with me to read later. And I have a couple of games for those times you are travelling for 10 hours and need something mindless to do.
Soon after I got the iPod, I was also delighted to find out that I could sit in the parking lot of our public library (it wasn't open for the day yet) and access the Internet on their wi-fi network. I haven't had much luck with wi-fi in other spots, although we are supposed to be able to get on wi-fi at Starbucks because we have an AT&T account. I was able to use my ipod the last time we stayed at a hotel that had wi-fi, and it really came in handy.
You notice I haven't said anything about using it as an MP3 player; I keep meaning to load my music on it, but I've been so busy using it for other stuff that I haven't gotten around to it. . .
[Edit] You asked about a USB port. The iPod touch plugs into the USB port of your computer for charging and to access iTunes. I'm not sure how to download anything else to it without a wireless connection. Someone else will have to tell you whether it is possible.
