Tonga http://luckyredfish.com/tonga Downloads http://luckyredfish.com/downloads Check it out you will not be disapointed!
Tiny Wings and Temple Run are both really fun! If you don't mind paying a bit, Scribblenauts is also great
Pfft...these are no-brainers: Jetpack Joyride Punch Quest Into the Dead Shadow Warrior Doodle Army 2 Random Heroes Trigger Fist Bean's Quest RAD Soldiers
I never used to put money on my iPod check these out Score clasic goals Tiny tower 14px Punch quest 30secondlife Angry birds rio (just went free) first episode of the walking dead Forever drive
Jetpack Joyride is the easy winner IMHO. Punch Quest is great too, though I paid for it when it was paid.
Connector and Darius have great lists and i'll add: Zombie Tsunami One Epic Knight Subway Surfers Pitfall Elements Defender <-- the FREE one is the full game without the bonus gems. Run N Gun Agent Dash Star Warfare Major Mayhem