Help - Imac is not recognizing Ipod, Ipod already in use?

Hoping someone can help. I am posting this in this forum and in the Ipod forum, since I am not sure where it should go.
My son has a new G5 Imac that has been working great. He has the 60 gig Ipod Photo that has been re-configured from his original PC to now use with the IMAC and it has been working great, until now.
He had a problem with his IPOD and received a bad nasty error message and had to have it replaced under warranty. Tonight he plugged the new IPOD in and the IMAC did not immediately recognize it at all. So went to install the software and his IMAC told him that the IPOD needed to be updated, and when he went to update it he got a message stating that it is in use by another program and cannot be loaded or modified. There is no other program that is using the IPOD at the moment that he knows of.
I am hoping that this is a situation that can be easily rectified. I am a MAC novice and have no idea where to begin. Thank you!!!

Is it mounted in Itunes Maybe?
--Spire

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