Absolutely, the clickwheel was superior to touchscreens in some situations. One thing that pissed me off about the iPhone (when I had one) that kept me going back to my 1st Gen iPod Nano was that the touchscreen was, for me, useless on a plane. If I was dozing on a plane, I couldn't skip forward or go back with my eyes shut. I had open my eyes and turn on a bright screen, which was annoying both for me, and for others during a long-haul, overnight trip. Adjusting volume was easier too, though that is possible using the hardware volume buttons.
For a dedicated music player, the click/touchwheel was hard to beat.
I've had an idea for touchscreen "blind music control", but I think it'd have to be implemented on the OS level, if the hardware even supports it. Specifically, keep the LCD off, but the touch sensor on to recognize gestures. Gestures that are not rotations of each other, e.g. _| and |_ should help the device differentiate between commands, regardless of orientation.