I have a GP2X and 2 Nokia 770's
They are entirely different machines. Here's a quick comparison:
Physical:
They are almost exactly the same Height and Width, but the Nokia 770 is about 1/3 the thickness. It is even thinner than a GP2X would be without the battery buldge.
Connectivity:
The Nokia 770 has Bluetooth and WiFi without installing/carrying USB dongles, hubs, cards, drivers, etc. I should note that currently, the Bluetooth implementation is, IMHO, at least partially broken. Most kinds of BT transfers (OBEX) don't work. Like the GP2X, the '770 functions (natively) as a USB storage device but it is only USB 1.1. They both do networking over USB.
Storage:
The 770 uses only RS-MMC's. These are currently limited to 1MB. 2MB cards are supported with a patched kernel. RS-MMC's cost about 2x as much as a SD card of the same capacity.
Battery:
The '770 includes a 1300mA Li-Poly battery that is recharged inside the '770. Battery life is about the same as the GP2X with a good set of NiMH's. This assumes NO use of the 770's WiFi, and NO use of the GP2X's video out.
Screen:
The '770 has an 800x480 touchscreen. The touchscreen is also pressure sensitive. This is a BIG difference over the GP2x's 320×240. Because of the aspect ratio of the screens, a 16:9 movie looks twice as big on the '770 than on a GP2x. The '770 has no video out, and there is no way I can see that it could ever be added. There is the potential to display presentations (basically screen shots) on a Bluetooth projector, but that is it.
Included Software:
Unfortunately, the '770 software sceen is not nearly as mature as the GP2X. This is the GP2X's main winning point. Great hardware is useless without good software, and unfourtunately, this comes across very plainly on the '770. Like the GP2X, There is a recent 2.0 firmware for the Nokia 770. Unfortunately, the '770 2.0 firmware broke all existing apps, and only about 20 apps currently exist (not counting command line apps/commands). There are no emulators (except ScummVM). Also, while speed has improved in the 2.0 firmware, the 770 does not appear nearly as responsive as the GP2x. Realize of course that the 770 apps are more sophisticated than the ones on the GP2X, and thus larger, but the user just cares about the appearance of responsiveness, and that is better on the GP2X.
Media Playback:
As I mentioned, the '770's screen is much better than the GP2X's. The included media player, however, is not as good as the GP2X's. There is no hardware decoding/scaling. There is no resume feature. In the old (2005) firmware, the 770 could only handle mpegs of certain resolutions, and the framerate was limited. This caused noticable skipping on anything I have played on my 770. This is supposed to have been improved in the 2.0 firmware, but I have not had time to re-encode my videos to give this a good test. Any file that will play on the '770 will play on the GP2X, but certainally NOT the other way around.
Price:
The '770 has been available at CompUSA for $299. Given that the 770 includes a Li-Poly battery, WiFi, Bluetooth and a better screen, I feel that it is a better /hardware/ value than the GP2X. The PSP and the Nitendo DS include rechargeable batteries and wireless. Also concider a Nokia N-Gage. These too have emulators available and include Bluetooth, a Li-Poly battery, and currently sell for $99. I feel that the GP2X asking price is too high for what you get. I am not at all unhappy with mine, I just think that to be competitive, the GP2X must reduce the price, and/or include at least 1 form of wireless and rechargeable batteries.
In short, the Nokia 770 does a lot more than the GP2X, but the GP2X is better at what it does.
If there is interest, I'll post a comparison of the GP2X and the N-Gage QD.