Cockpit Voice Recorders only record the last two hours before overwriting the previous recording, but it's two hours from numerous different audio sources within the cockpit (I think there was something like nine or ten different mics), so it's not just a single audio recording. It starts adding up quickly in terms of memory storage. It's ten simultaneous synchronized recordings being saved rather than just one. Which is not to say there's no room for improvement.
It's easy to just introduce the next generation iPod when you want to improve data storage there, not so much when it's a black box that has to survive horrific conditions, has to meet standards of a bunch of worldwide agencies, airlines, and manufacturers, and has to be worth the multi-billion dollar cost of making the massive change when incidents that require more than two hours of voice recording time are extremely rare.
There are plans to increase the recording time and to add video in the cockpit however.