A hacker named niacin has achieved root access on the iPod Touch as well as the iPhone 1.1.1!
From his blog:
"Using the tiff exploit, we have managed to expose the root parition via the symlink hack. We have verified the exploit with an iphone 1.0.2,1.1.1 and itouch 1.1.1
We are currently working on remounting the / parition rw and we will be hosting the exploit on this site SOON."
Niacin's blog via TUAW