Updating 8GB Nano

I had an old 40GB iPod that worked great. Never had a problem, until it died last month. I replaced it with an 8GB Nano and most of the songs transferred smoothly (though without the playlists - not enough space).
Now, when I try to update, the software runs and it says it's updated, but the new songs aren't there and the screen is grayed out and won't let me delete or add songs. And, there is a padlock looking thing to the right of the capacity on the bottom of the screen that I've never seen before (but has nothing to do with the parental control). Never had this problem with old iPod. Any input on what to do?

You're welcome, I'm glad the information was of help. Just in case maybe you want to try another option, a different way to manage an iPod with a smaller capacity is to set it to "Sync Music - Selected playlists, choosing this update option allows you to create a playlist specifically for the iPod and drag the tracks you want into it. If you tire of the list and want to change it, you just add or remove the songs you don't want and the changes are made automatically to the iPod the next time you connect.
Open iTunes and create a playlist to update your iPod from, call it -iPod to make it the first playlist in Sources. You can make this a normal playlist and drag whatever you want to it or you can make it a random Smart playlist. If you are making a smart playlist limit it to just less than the size of your iPod (for example 3700MB for a 4G iPod Nano). Now connect your iPod and when it appears in the Source list click on the iPod icon to bring up the preference tabs in the main pane. Go to the Music tab and choose Sync Music and the Selected playlists radio button. Choose the playlist you just made from the selection and click Apply:
iTunes: Creating playlists of your favorite songs
How to create a Smart Playlist with iTunes
Take care.

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