Another user, Crystal, had the very same issue as your. She solved it and a flod of thanks came showering on her. Here is what she wrote:
The way I did it is: I had my ipod connected to my computer and I pressed the critical button and the menu button simultaneously* and.... after 6-10 seconds BAM!!! iT WORKED LIKE A CHARM IN THE FIRST SHOT!
In other words, If your iPod won't turn on anymore, you need to reset it. Hold the sleep/wake button and the home button together for at least 10 seconds until the apple logo appears