Which one is better for all purpose use? Iphone or ipod?

That is for listening music or browsing net or using it as regular cell phone, using it for skype.
which one is more updated?

I phone because you can communicate by calling people plus have all the other features of the ipod

I say iPod if it had Wi-Fi. It couldn't call unless you downloaded apps for it.iPhones completely suck for holding music if you have a bunch of music you want.iPhones run out of storage very quickly.iPhones also suck for Internet. They are so slow.

Iphone because it has everything the ipod has plus a phone

IPod Touch is basically an iPhone without the phone. As long as you have Wi-Fi you can even use it as a phone with VoiP apps. I've got mine tethered to a mifi now replacing my cell phone. It is way cheaper. Most people don't want to carry an extra device though. They both run in the latest version of iOS so they are updated the same. If you are near Wi-Fi all day, you don't even need to pay fir any plan.

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