In this Reuters article, Apple's vice president of hardware product marketing, Greg Joswiak, played down rumors of a 60GB iPod model.
Joswiak states "We have no plans in regard to announcing 60-gigabyte models. We are trying to create a much more compelling lineup with two models for 20 and 40 gigabytes at extremely compelling prices"
Rumors of a 60GB iPod started with a premature Toshiba announcement that Apple had already ordered the 60GB 1.8" drives.