I would like to see a built in speaker...it doesnt have to be much, just something that will allow me to show someone (or a group) a quick clip without making them put on the headphones.
The multi-square direction thingy doesnt really bother me. I guess I have the correct sized fingers

Ability to handle long filenames is a must
Continuing where you left off is also a must...one interruption and you have to fast foward through the entire movie to find out where you left off. Maybe an option like my dvd player software I have on my computer, it asks you if you want to continue where you left off, or start from the beginning.
It would be nice to be able to plug a usb thumbdrive in and transfer files back and forth. Just a thought.
I also would much rather prefer a CF slot over a SD slot.
I used the ULEAD Toolbox to convert a dvd to divx and it worked perfectly. Simple and played fine on my 442. Looked great and sounded great. Very nice!