Can every Android device be updated to the most recent Android version? I never dealt with Android devices before so I'm completely newbie at it, please comment if something is too simple.

Say I purchase Android Galaxy Player S WiFi 5.0, that has got Android Froyo 2.2 installed in it.

If there is a new version of Android released tomorrow or next month, will I be able to update it (like I will be able to update my iPod Touch 4 to iOS 5)?
No. Its up to the manufacturer to release new Android versions for their devices. Some devices will never get a new Android version. Only the devices from Google (Nexus One, Nexus S) will get the latest Android versions early and OTA. The others may get the new version, but it is the decision of the manufacturer.

Custom ROMs may provide a newer Android version, as the last official version that was released by the manufacturer. But this often only applies to popular devices.