New iPod Touch 32gb stalls after starting sync, error 54, manual synce gets dumped

I just got this thing at Walmart last Sunday and its been driving me nuts all week! It's the brand new iPod Touch 32gb 4gen. When trying to sync it will start to load music then stall. Sometimes it gives error code 54, sometimes says it cant convert song, cant find song, or just stalls. If I wait anywhere from 15 minutes to an hour it will finally un-freeze and dump everything or say the connection has timed out. I've ran repair on iTunes from control panel, no help. Un-installed iTunes and re-installed it then tried synce, no help. I un-selected everything in the iPod summary so that it wont try to synce when I connect it and selected manual synce. Then I could sync a few songs at a time, but it still stalls after only loading a few songs on iPod. Tried dumping everything out of the ipod and start over, several times, no help. I've been 6 days, all day, every day, and half the nights getting a few songs at a time on this dam thing. I found when it stalls if I turn the iPod off to force it out of iTunes I can then restart iTunes, reconnect the iPod, manually select 15 to 20 songs and drag them to the iPod. A few times I got over a hundred to sync but usually 20 to 30 songs then it stalls. Then I have to do the whole thing over again. I had a little over 1200 songs out of the 1877 songs, 11.28gb, in my music library when the last time it stalled, it dumped everything. 4 or 5 days of manually syncing a few songs at a time, GONE. Just poof, all that work for nothing. The only thing left on it is 92 of the hundred something songs I've bought from iTunes. I'm ready to take a hammer to the dam thing and send it back to Walmart where I got it.
I'm using a Dell Studio 17 inch laptop that's about 4 yrs old running Windows 7 that I installed 2 years ago. I had a iPod nano 2gb that worked fine with this computer & iTunes untill it died last spring.
Why do you have it set up so that one little hickup and the dam thing dumps everything thats on it? I cant even stop it from starting to sync when I connect it because I need to see the settings in the summary for the iPod to change the settings, but I cant see that until I connect it, but as soon as I connect it, it try's to start the sync and stalls feezing everything.
Can anybody help me before this thing drives me completely over the edge!?
The ColoradoHermit

I have a older Dell Optiplex desktop computer running Windows XP. I copied the iTunes  folder on my laptop to an external drive and plugged that into my desktop computer. Then connected the iPod Touch to the desktop. For some reason or other the computer thought the iPod was a camera and wanted to know which photo program to open with or for it. I never did get iTunes on my desktop computer to "see" the iPod and had to give up that idea.
When going into the My Computer or Windows Explorer - which is the one I like to use for working with my files-  when I connect the iPod to my computer in Windows Explorer it will show the iPod. Open that and it shows Internal Storage, open that and a folder with DCIM shows below it, open that and a folder with 860OKMZO on it shows below that, open that and it has the 40 or 50 photos I saved from Facebook. That's it, there isn't anything else shown in its storage. The iTunes on my old Desktop doesn't see the iPod Touch either.
Even if the iTunes on my old desktop would work with this iPod Touch it wouldn't do me any good. I read in a post that once it is connected to a iTunes Library, if its connected to any other iTunes Library on a different computer it will dump everything that's on it. Which is totally stupid but I think they - iTunes - have it that way so that you cant share your music with somebody elses computer. But that also makes it so I cant manually sync one thing at a time with my own iTunes Library. I tried syncing my music first and after I got some of it on the iPod, in its summary I deselected the music sync and selected the movies or video's so I could manually synce a few to it to see if it would work. Bad move. As soon as I did that it dumped everything that was on it, then said that it could not sync the movies because the files could not be written. HUH? Why a video from YouTube could not be written beats me. But why did it dump all the music?
The last thing I did with it was put all the options in the summary in iTunes back to default, removed everything on the iPod that was left after its last dump, then disconnected it, closed iTunes, and rebooted my laptop and started over from scratch. Started iTunes, connected the iPod, after iTunes found it I opened the iPod summary, made sure everything except sync photo's was selected, then started the sync function. It immediately listed all the songs and the songs info in light gray under music on the iPod. It only got 2 songs copied, then stalled. I just left it alone to see what it would do. I opened the Windows Task Manager to see what it was doing. Even though the iTunes program appered to be stalled it was using 50% of the CPU. After about 15 minutes it showed a popup window saying the song could not be writen then another saying its connection to the iPod had timed out, then iTunes stalled and "not responding" showed in task manager and at the top of the iTunes window. After 30 minutes I had to force it to close with the Task Manager. By then it was after midnight and had been another 12 hours wasted messing with this thing.

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