Ok, this problem is serious. But this is relatively simple, just go to recovery mode. Make sure your iPod is plugged charging. Hold the home and lock button. The screen should go black, and when the Apple loge comes up, release the lock button. Hole the home button until the thing tells you to connect to iTunes. Connect to iTunes, and wait. iTunes should say "iTunes cannot connect to your iPod touch because it is in recovery mode" or something like that. After this, just simply hit "restore".. It should start restoring the stuff or resetting everything like new.