Here is a decent format that SHOULD be useable on your iPods. NOTE: i do not have a video iPod because i am waiting to get my money back for my broken 3gen from American Express.

MODE: MPEG 4> CBR
Resolution: 320x240 (I think it is full screen)
Passes: 2
Bitrate: 768kbps
Framerate: 29.97fps OR 23.976fps

LET ME KNOW IF IT WORKS! Try using small video first.

Converter (http://www.videora.com/en-us/Converter/iPod/)

Here is the link to a 1minute video that is encoded with the format above.

VIDEO (http://esnips.com/foldermember/ce0801db-1904-4970-b74c-afa5a3485f7c/?source=ws&v=325121)

LET ME KNOW IF IT WORKS ON YOUR IPOD!!!!!!!