Ok, it really sucks that there is no note taking app on the iPod Touch. It is such a useful feature that it puzzles me why it was left out. Anyway, if you want to take notes on the iPod Touch anyway, here's a very ugly hack to make that happen.
You can do this using the Contacts feature. Just create a new contact and set the 'Company Name' field to the title of your note. Leave the first and last name blank. Then scroll down to the bottom of the fields and click on the 'Add Field' button. Scroll down to the bottom of the list of fields and pick the 'Note' field. Edit the note field to have the contents of your note. Then just save everything. Your new note will show up in the contacts list as if it was a company name, containing just a note.
It ain't pretty, but it works. At least until Apple gets off their lazy butts and puts those missing apps back into the iPod Touch!