in my opinion they are.. yes, the sound quality on my creative zen sleek is alot better, but the zen is alot weaker than the ipod. the build quality and reliability on the ipod (mine at least..) is excellent, mine has been dropped literally hundreds of times, and a couple of times from 6ft, or over onto cobbled streets (i do weird things when im drunk in egypt..), and the only damage i have is a cracked screen. it works perfectly fine, and makes the noises its supposed to.. another reason why i was very impressed with the ipod was how well it coped with being dropped in a lake (twice). no damage whatsoever to the ipod there, i just put it in the airing cupboard for a couple of days, and it works fine..
after all the abuse i have given the ipod, i can defiatley say that they are well built.. either that, or i have got a super strong ipod (very unlikely IMO). yes, they are expensive.. but for what you get, i feel its well worth it..
as i said above, the creative zen sleek i have got has alot better sound quality, but tbh, i dont really care too much about sound quality, as long as i can hear it, im not too bothered.. the ipod is perfectly fine sound quality for me..
another thing is.. they wouldnt be this redicously popular if they were that poorly made.. if i rember correctly, there was a batch of nano's with dodgy screens, but they resolved this, and they have stronger screens now.. i rember reading something like that before..