If its just for the gym, I personally would go for the nano. Unless you want the fitness apps that keep track of what you do, I just want my iPod to play music when I work out. It's small to tuck into whatever pocket I have available and if I drop it I don't feel too bad.
I have the touch, and love it!
So I can only advise you based on my own experience. Is true that it's more bulky (I have to put it on an ipod arm holder), but you do not buy it just to do gym (I think), but for life.
I use my nano when I workout. Mine is the 6th Generation and I like it because it has a little clip on the back already so I didn't have to get any accessories for it. I don't feel it when it's on my clothes because it's so tiny, it's super basic (aka easy to use while jogging or something), and it was very inexpensive so if I drop a weight on it or something it's not that big of a deal. Though I've had this nano for about 3 years now and it's perfect still.
I would go for Touch. I use my iPhone for music (in the gym and outside of the gym). I would prefer the Touch screen for gym though. I do cardio and weights. In fact, most of the time, I do weights.
My husband also prefers his iPhone. I gave a nano to my husband for gym and when he is out mowing the lawn. But that ended fast. I even got him different ways to wear it. And still, he just put it aside in some drawer.
I would imagine that it really boils down what you feel comfortable with. I don't wear it on my clothes. I usually put it aside, or I just don't listen to it when I am doing weights. I really have to concentrate on the weight lifting.