Is Ogg Vorbis really *that* much better? Is is it just equally good at a much lower bitrate (thus saving diskspace?)

Another question : I know the empeg can be equiped with Ogg decoding since it decodes the audio files in software. But can the same be said for the iPod? Or would that require a hardware upgrade?
I'm guessing most of the portable mp3 decoders decode their files in hardware, or am I wrong here?