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I picked up an older Zune 30GB (woot.com) and already had an iPod 30GB. After using both for music, audiobooks & video my choice based on many aspects is the Zune 30.
The screen & video performance is much better than the comparable iPod. The Zune accepts .WMV Files in syncing with solid playback performance. The size of the screen can't be appreciated until compared to an iPod with a smaller screen playing the same movie.
The FM Radio is a huge plus.
I don't see the Zune being a serious threat to Apple.
It simply came down to personal choice & preference.
I given my iPod 30GB to my son.