Just spotted on: http://blog.p2pfoundation.net

Microtouch - The ultimate AVR-based iPhone killer!
http://www.ladyada.net/products/microtouch/

"Sure, the iTouch is pretty cool. But who wants such a locked down device? Why 
not build your own touch-screen device, with your own apps, all on open source 
hardware and using open source tools? OK, it can't play MP3s, but it does have 
a 320x240 TFT color display with resistive touch screen, an Atmega32u4 8-bit 
microcontroller, lithium polymer battery charger, backlight control, micro-SD 
slot, and a triple-axis accelerometer. Yeah, this is the next big thing and for 
those of us who like to DIY, you can do a lot of cool stuff with this dev 
board."

+ video showcasing using it as ebook reader
http://youtu.be/314v1H_aN2o

=)
~ elf Pavlik ~

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