I have used skype on wifi to make calls from my ipod and it worked fine. Now if want to get creative and convert your ipod touch to a faux iphone, it is as easy as buying a Sprint Peel for yourApple iPod touch and getting a cheap data plan and a special app.
This is all you need to do if you want a fake iphone conversion this is what you can do:
Virgin Mobile introduced the ZTE PEEL 3200 [virginmobileusa.com], a casing for iPod Touch 2nd and 3rd generation models (1st and 4th models are out of luck for now). The case costs $100 and has a no contract 500MB plan (Appx. 25hrs of 3G access) for $20/Month on the Virgin Mobile network.
In order to turn your iPod Touch into an actual phone, download the Talkatone [apple.com] Application from the Appstore and set up a free Google Voice [google.com] Account from your computer. You will be able to make free phone calls to the US and Canada via your iPod Touch where ever you have WiFi or 3G access.
This a good way to cheat paying $40+ a month for contracted phones and eliminates the need to bring both your iPod and phone with you wherever you go. All and all, it’s like having an iPhone on a $20/Month plan.
Edit: Sprint [sprint.com] also has the PEEL on 1GB/Month no contract. Sprint is selling the PEEL for $80 and costs $30 per month. – Thanks tparks
Virigin Mobile is a part of the Sprint network so service should be about the same.
Edit 2: Made a comparison chart for Sprint and Virgin Mobile plans, see attached image.
Edit 3: Forgot that the 2nd and 3rd gen iPods didn’t have a mic built in. You can use any set of earphones with a built-in mic [amazon.com] OR a plug-in microphone [amazon.com] (Between $2-15) as a Microphone and use the iPod’s Speakers to make calls. The Virgin Mobile PEEL comes with a “Headset Adapter” if you already have a headset.