Brand new Nano needs software update??

I just got a 2GB Nano for my wife and have it installed. it synced most songs just fine, but it did not download purchased music. It then says that not all songs could be downloaded because the software is too old. I checked on the Apple page and the Nano software is 1.0 and that is what is installed on the Nano. I tried to download the update and it doesnt load because it is already installed on the computer from my 3Gen iPod. Any ideas as to what is going on and how do i fix it??

I also am having exactly the same issue as James with my computer. In fact all of the music and free podcasts download to the Nano except music purchased from itunes. I am getting the same message to update my ipod software. On about every 5th download attempt it successfully loads the purchased music. All other automatic updates remove the purchased music and indicate that I require an ipod software update.
Thanks for the suggestions, Chris. I have also reset the ipod and deauthorized/reauthorized my account. Great idea, but not a solution for me. I too am running 6.0.1(3). I believe Apple should be concerned with this problem - a Nano that runs everyone else's music except that obtained legally through Apple I-tunes.
OK. These ideas might help:
http://docs.info.apple.com/article.html?artnum=300766
Chris
Tagar System Pentium 4   Windows XP  

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