Considering what a huge asset the Touch is to Apple, and seeing how so many 2nd gen users will be upgrading this year, I don't understand why they wouldn't.
I think everyone will want to upgrade to the 5th gen myself included it's my second priority after getting an NGP. I think a lot of 4th Gen users will upgrade as well as long as it's using the A5 which it better at least be. For games players this is definitely the way to go as the built in dual gpu (PowerVR SGX543MP2 GPU) is at least 5 (apple claims 7) times faster than the one in the 4th gen. What this means is sometime in the future the new games will only be supporting that GPU and will look a whole lot prettier.