Yea..Imagine what kind of stuff you will doing with ipad.

Watching videos, reading, light gaming and surfing net.
Ipad 1 can do all these so far.

Better get 32GB at least. Some 3d games can hit closer to 500mb storage.
Bigger storage is also good for those who don't want to waste time in converting videos into mp4..

Watch and delete. There are apps which allow to watch rmvb, mkv, avi, flv or so on.