There is definitely a certain way that the iPod likes to be formatted.
If you format your iPod from Windows Explorer, the MacOS Finder, or a third party utility, you may end up with a very sick—and perhaps irreparable—iPod. The iPod has hidden partitions, which contain the iPod’s “Firmware” (the mini operating system that drives the iPod itself). Some formatting utilities have been known to obliterate this vital component of the iPod.
Instead of formatting the iPod this way, you should use the “Restore” function of the “iPod Updater” program, available from Apple. This will format (completely erase) your iPod, and reload its Firmware to the latest version. You may have used this “iPod Updater” program in the past to update your iPod to the latest version. If you don’t already have it on your computer, download it free from http://www.apple.com/ipod/download/ .