The devices look and feel about the same, but with a nice glossy finish on the hard-drive models. As a commenter noted on one of the gadget blogs last week, the HD models won't come with the premium braided Zune headphones and instead come with black earbuds.

I love the way the Zunes can display track information from FM radio, and that you'll now be able to click to put a song into a queue so you can buy it the next time you sync a Zune.

But with earlier Zunes, I found the track info didn't always come through or took awhile to display. I'd end up moving the earbuds around to make it work, since they serve as the radio antenna, so you're not going to get the song info if the Zune's in a dock, for instance.

So it was a little entertaining to see Zune Director Adam Sohn do the same thing, trying to get the song info to display so he could demonstrate the FM "click to save" feature.

When he was explaining how Zune works with broadcasters to take advantage of metadata they're sending out, it made me wonder if Microsoft's got bigger monetization plans here and we'll start seeing offers and ads show up in radio stream data and not just on the Zune.

Sohn also talked up the new wireless feature, which he characterized as device-to-clould vs. the device-to-device sharing highlighed in Zunes 1.0 and 2.0. Basically, the feature lets you connect a Zune through Wi-Fi hotspots and stream any song in the Zune store that's available for suscriptions.

This is kind of neat, but it's not there yet. When I think of device-to-cloud, I think of being able to use Wi-Fi to access all sorts of things, including my music and even photos stored online. But this first iteration is focused on driving Zune subscriptions.

I'll bet Microsoft would have better luck moving Zunes if it really was a tuner for your cloud-stored music collection and not just a tuner for the Zune Marketplace, but apparently it's held back here by business strategy and record label restrictions.

"I think we'll get there but we're not their with this release -- stay tuned on that,'' Sohn said.

Speaking of wireless, I asked Sohn if there are any plans to produce an application similar to the iPhone/iPoud Touch "Remote" application that lets you use those devices as a wireless remote for iTunes. Sohn that's "not on the list of stuff we're doing right now."

Also new are Zune "Picks," which suggest music based on what you're listening to and "what people lke you are listening too,'' Sohn explained.

Microsoft's also hoping that more people will use the free Zune software as a computer jukebox, even if they don't buy a Zune player. That's probably pretty optimistic, since iTunes is ubiquitous and Windows Media Player is already bundled in PCs, but the Zune software does have some lovely album art displays.

There are two games -- Hexic and a poker game -- but both crashed the hard-drive and Flash Zunes in the demonstration. Sohn said it was beta software. Still undetermined is when you'll be able to download additional games.

By the way, Zune has abandoned the Bear Creek offices near the Redmond Target that it customized a few years ago. It's now occupying a warehouse like building on the former Safeco campus that Microsoft acquired; the building was previously used as Microsoft's corporate library but it's now decorated here and there with funky Zune stuff.