The D60 is technically better, but not by much. It's a smidge larger, and has 10.2 megapixels versus 6.1 which hardly matters unless you are looking to print very large prints. (Even then I've heard of 24 x 36" prints from a D40 if done correctly). I'm sure there are other small feature differences, but nothing spectacularly different IMO.
Strange you saw the D40 higher priced, as historically its been the other way around. IMO, though, if you are considering the two is to pick the one that has the best "feel" to it, as they are very similar.