If you can't update it, make sure to download the latest software update off Apple's website.

Install the iPod Updater first, then plug in the iPod. Restore factory settings, and then install the new software updater. That should help.

You can do a soft-reset by holding down the Menu and Play/Pause Button for 10s. If you have a 4G iPod, hold down the middle button(on the wheel), play/pause, and menu button for 10s to reset it.