I'm not so sure about the Flash update on the Touch. Apple went to great lengths to get YouTube to convert their videos to h.264, which the Touch plays quite easily. Apple have also provided many tools to help web page designers convert their pages to be iPhone/Touch friendly. Besides, I wouldn't base giving the gift on something that might happen, but rather on what it can definitely do today. Furthermore, the third party apps are not approved by Apple. Nobody knows what the SDK will provide yet. At least with the N800, everything you want to do now can be done.

I used to have a Touch and found it a pain with websites. What you think would work in a normal web browser doesn't. Having no Flash support really does limit the Touch. I'm sure others here will testify that the N800 isn't that hard to use.