Folder w/ Exclamation Point + Itunes fails to recognize Ipod

About two weeks ago, my Ipod began to act silly by apparently not being able to read certain tracks sort of like when a CD player cannot read a scratched CD. (Note I have never encountered this problem before and the Ipod functioned without any problems just the previous day). When it could not play a track, it would automatically skip to the next track to see if it could play that one. It did not matter what album or artist I was attempting to play.
Then, the Ipod began to hesitate to turn on occasionally. The infamous folder with an exclamation point would pop on the screen, especially after I would reset the Ipod and have seen the apple picture.
The final conflict exists in my Itunes program being unable to recognize I had plugged my Ipod into the computer. (Maybe the Ipod could not read the computer, I have no idea). I have Itunes version 4.7 and I have just installed 4.9 which I am about to try. I shall post an update if my Ipod then works with 4.9.
Otherwise, please help me! What is wrong with my Ipod?

To all:
You need to restore your ipod so it like it was when you received it. Then you need to instal the new version of the updater and itunes. Connect your ipod and it should take you through the process. Registering and all.
If all fails, seriously consider returning it to apple. If you still have the warranty. If this your second return under the warranty you'll actually have to pay money (around $30) If you don't have a warranty I think you can get it fixed but it will cost you a lot of money. Try getting a quote if its too expensive, consider selling on ebay and getting a way better mp3 player.
Apple SHOULD really consider recalling the ipod, this device it horrible. I my self have had 3 new ipods straight from Apple in the last year all with the same problems you all are having. I regret even getting the ipod to begin with.

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    I notice your sig says you have a Sony Vaio. The Sony Media Watcher program is known to cause conflicts of deleting itunes libraries - not your specific problem, I understand, but I wonder if this is some new fun feature that is somehow related?
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    Here's a few that weren't posted too:
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    Welcome to Apple Discussions!
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    http://www.apple.com/itunes/download/
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    1. Open the disk utility, hope your iPod appears there (left hand side), highlight it
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    4. Same as step 3, but open the “Security Options....” and choose “Zero Out Data” before click Erase. It will take 1 to 2 hours to complete.
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    Go to folder “My Computer”
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    Eject your iPod and do a Reset
    Open the iPod Updater and click “Restore”
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    a. It does not matter whether the format is completed or not, the key is to erase (or partly) the corrupted firmware files on the Hard Drive of the iPod. After that, when the iPod re-connected with a computer, it will be recognized as an fresh external hard drive, it will show up on the iPod updater.
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    c. You may need to switch around the PC and Mac, try to do several attempts between “Format” and “Restore”
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    If you have tried trouble shooting your iPod to no avail after all the steps above, chances are your iPod has a hardware problem. The iPod's built-in Diagnostic Mode is a quick and easy way to determine if you have a "bad" iPod.
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    iPod 4G+ (includes Photo, Nano, Video, and Mini): "Menu" and "Select"
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    iPod 1G to 3G: "REW", "FFW" and "Select"
    iPod 4G+ (includes Photo, Nano, Video, and Mini): "Back" and "Select"
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    If none of these steps address the issue, your iPod may need to be repaired.
    Consider setting up a mail-in repair for your iPod http://depot.info.apple.com/ipod/
    Or visit your local Apple Retail Store http://www.apple.com/retail/
    In case your iPod is no longer covered by the warranty and you want to find a second repairing company, you can try iPodResQ at your own risk
    http://www.ipodresq.com/index.php
    Just in case that you are at the following situation
    Your iPod warranty is expired
    You don’t want to pay any service charges
    You are prepared to buy a new one
    You can’t accept the re-sell value of your broken iPod
    Rather than leave your iPod as paper-weight or throw it away.
    You can try the following, but again, only do it as your last resort and at your own risk.
    Warning ! – It may or may not manage to solve your problem, and with a risk that you may further damage your iPod, which end up as an expensive paper weight or you need to pay more higher repairing cost. Therefore, please re-consider again whether you want to try the next level
    Last Resort Level
    1. . Disconnecting the Hard Drive and battery inside the iPod – Warning !! Your iPod warranty will be waived once you open the iPod.
    In Hong Kong there are some electronic shops offering an iPod service for Sad iPod, the first thing they do is to open up the iPod’s case and disconnecting the battery and the Hard Drive from the main board of the iPod. Wait for 5-10 minutes and reconnecting them back. The reason behind which I can think of is to do a fully reset of a processor of the iPod. In case you want do it itself and you believe that you are good on fixing the electronics devices and have experience to deal with small bits of electronic parts, then you can read the following of how to open the iPod case for battery replacement (with pictures)
    http://www.kokopellimusic.us/KM_instructions.htm
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    2. Do a search on Google and some topics on this discussion forum about “Sad iPod”
    Strange error on iPod (probably death)
    http://discussions.apple.com/thread.jspa?threadID=435160&start=0&tstart=0
    Sad Face on iPod for no apparent reason
    http://discussions.apple.com/thread.jspa?threadID=336342&start=0&tstart=0
    Meeting the Sad iPod icon
    http://askpang.typepad.com/relevanthistory/2004/11/meeting_thesad.html#comment-10519524
    Sad faced iPod, but my computer won’t recognize it?
    http://discussions.apple.com/thread.jspa?messageID=2236095#2236095
    iPod Photo: unhappy icon + warranty question
    http://discussions.apple.com/thread.jspa?messageID=2233746#2233746
    4th Gen iPod Users - are we all having the same problem?
    http://discussions.apple.com/message.jspa?messageID=2235623#2235623
    Low Battery, and clicking sounds
    http://discussions.apple.com/thread.jspa?messageID=2237714#2237714
    Sad faced iPod, but my computer won’t recognize it
    http://discussions.apple.com/thread.jspa?messageID=2242018#2242018
    I am not suggesting that you should follow as well, but just read them as your reference. You are the person to make the call.

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