I use Smart Playlists to control what's on my 20GB iPod based on when a song was last played.

RatingRule
*****Always on iPod
****Once played disappears from iPod for 90 days
***Once played, disappears from iPod for 180 days
**Once played, disappears from iPod for 1 year
*Never on iPod
Always on iPod in "need to rate" playlist