My iPod will not be reset to factory settings

Hello I am new at this. And I'm not very computer-savvy. But I love my mac.
Here is my problem. I have updated my iTunes on my eMac to the latest version. I plug in my iPod (2nd generation, 3.1 I think) and although my iPod shows up on the desktop and on "my computer" iTunes says " may be corrupted. You must reset it to factory settings" I agree, and follow all the prompts to reset it, and when I do, it shuts iTunes down. So I have an updated iTunes and an older, empty iPod that I cannot reset to factory settings.
What can i do?
Thanks, Dehnerdog

For Mac computer
1. Open the disk utility, hope your iPod appears there (left hand side), highlight it
2. Go to Tab “Partition”, click either “Delete” or “Partition”, if fails, skip this step and go to 3
3. Go to Tab “Erase” , choose Volume Format as “MAC OS Extended (Journaled), and click Erase, again if fails, skip it and go to 4
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.
5. Eject your iPod and do a Reset
6. Open the iTunes 7 and click “Restore”
Please note that you can have a try to skip the "zero out data" option

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