I'm putting this here because it is useful.
This morning, I dropped my iPod. I picked it up and reset it using the given method. And it showed me the Apple Logo Screen. It then showed me a picture of an iPod with a sad face. This meant that the hard drive was gone. Destroyed, and the only way to bring my iPod back to life would be to either get a new iPod, or get a new hard drive, and either replace it yourself, or get an Apple Support Person to do it for you. I did neither. I did the following:
1. Wack the bottom off a paper pad. This places the connector for the hard drive back into place, if it has come loose.
2. Place the iPod into Disk Mode, and then use iTunes to restore the software.
The iPod should work. For some odd reason if it doesn't work, then don't give up. But I had a dead iPod, and now I have a good one. The GUI does go a tad slow, but I can't help that. :P Enjoy.