I've also had rebuffering problems with the Touch, and I believe it is a known issue. In my case it was probably in some of the network settings I had (which were mostly default). I spent some time going through all my settings, and my Squeezeserver settings, and eventually figured it out - not a hiccup since after several months. It was highly annoying when it was going on though, rendering the system useless. Regrettably I do not know exactly which setting did the trick, but if you Google the issue you may find some suggestions. I would point out that it not exclusively a wireless network problem, as I initially thought it was (and tried many of the things being suggested here). It may have had something to do with the buffer/streaming settings. All the suggestions about wireless are absolutely spot-on in being possible solutions, but none of them solved the problem for me. The OP indicated that he has the same problem via Ethernet as well, so I'd say you could probably rule the wireless solutions out.
I've used the AE and prefer the Touch in virtually every way, especially sound quality, both as a DAC and streaming digital data to a DAC. The AE always seemed to compress both dynamics and soungstage (at least that's how it occurred to me). Per Kijanki you will not be able to get full resolution from hi-rez files via AE (No problem via wireless on the Touch). It would be worth it to take the time and effort to sort out the problem with the Touch if you have the patience, or can enlist a friend who is fluent in Geek to go through your network and Squeezeserver settings with you. Definitely put a stress on the fact that the problem occurs with Ethernet as well as with wireless.
I've used the AE and prefer the Touch in virtually every way, especially sound quality, both as a DAC and streaming digital data to a DAC. The AE always seemed to compress both dynamics and soungstage (at least that's how it occurred to me). Per Kijanki you will not be able to get full resolution from hi-rez files via AE (No problem via wireless on the Touch). It would be worth it to take the time and effort to sort out the problem with the Touch if you have the patience, or can enlist a friend who is fluent in Geek to go through your network and Squeezeserver settings with you. Definitely put a stress on the fact that the problem occurs with Ethernet as well as with wireless.