You can do "flat" knitting (like scarves) on the round looms in addition to knitting tubes on them, so that makes the round ones versatile. The Knifty Knitters come in a set of three sizes, one is good for baby hats, one for children, one for adults. I also made some matching scarves (flat) on the looms before I learned to knit with needles. There are straight looms available which are good for flat items (scarves, strips sewn together to make afghans, etc.), but to do a hat on them you would have to seam it up.
FYI - There are some Yahoo groups for loom knitters. You can find links to instructions, free patterns, etc. on those groups.
I hope this info helps.