Punctuation doesn't matter in terms of the SEO impact. You can use commas or the | (bar) character if you like... what really matters are the words you use and not separating important keywords. For example, if "red knit hat" had proven to be a good key phrase, dont write " red small knit hat", instead write "small red knit hat".
Your TITLE tag becomes your headline on Google, and as such, you need to write it as an AD headline. So write it in a way that will flow, while putting most important keywords in the beginning
You can use commas or other punctuation - but ideally you make it sound natural. I have also heard that long strings of commas or the Bar | character are give-aways to Google that you have 'stuffed' the tag with keywords, which may hurt you in terms of SEO.