No, they still have it but the new one that plays the video is the same price but a better iPod. you will still be able to find the ipod nano. Yes, they do, and they are 100 dollars cheaper than a regular sized iPod (nano-150-regular-250). And they can do the almost the same things as a reg one, but beware, their batteries run out FAST and I mean FAST.
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Currently, the iPod Nano 4G is the only one being produced. Others may be sold, but no more are being made. Therefore, they will eventually run out, if they haven't already.