More rumors have come out of the Chinese forums, as well as a leaked photo of what is claimed to be the latest iPod Touch with camera built in. According to the rumor, the next iPod Touch is supposed to be announced week beginning September 7th.

The photo to the left shows the back of the device where at the top a camera can be seen. It is expected that the new Touch will be able to capture video as well as the ability to edit video and upload it to services such as YouTube. Makes sense, seeing as how the current iPhone 3Gs can handle it.

With the iPod Touch already a major contender in the handheld gaming segment, it should be interesting to watch its future land-grab at the low end digital camera/video camera markets. Personally, I still encourage people to just get the iPhone over this. How big are your pockets, guys? Enough for a phone, mp3 player, camera, keys..  why not just have a device that takes care of the first three (or at least the first two)?

The main question here is – real or fake? Suggestions over at 9to5Mac indicate that due to the amount of scratches on the back of such a new device that it’s probably fake. However, those of us that have used iPods and iPhones before could testify that those scratches may have been done in a matter of days. What do you guys think?