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I think that a lot (not all, obviously) of iPhone users are looking to consolidate. The fact that it's plugged in and synced most every day makes it easier to carry only an abbreviated version of your media library.
That's the reason I chose the 8gig. If it were only a phone to me, I would probably have chosen the smaller/cheaper model... but the idea of lumping everything into one device is what sold me on the iPhone in the first place. When that's your goal, it makes sense to go for the most storage possible.
I could be wrong, but it seems to me that the vast majority of the people who post here chose the 8GB model, as did most purchasers in general (which I am assuming only by my personal experience [people I know--all have 8GB if at all] and the fact that they discontinued the 4GB so quickly, and could very well be wrong, if so someone please correct me). I don't know if theirs are the same or similar reasons I had for choosing the larger one, or because of the price difference really not being that much, or a combination of those or other factors.
I got the 4 gig because I didn't want to rob my mother of another $100. (She wouldn't let me pay for it myself.) If it had been $399 at launch, well, uhm, dur.
Was also going for consolidation as well, but no matter what I would have gotten the largest capacity as things tend to grow over time and I get lazier with the sync process as time goes on.
yea i think 1 gb is all ineed i dont need like a gazillion songs or movies but they do kill some time every once inwhile but since im paying like 299 i rather just dump in a 100 more for double incase i ever do