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If you've got a PC try http://www.xilisoft.com. They do some great conversion software - i bought the video conversion software that allows me to convert AVI to MP4 that can play on the IPT - it's great and cost $35.
 
you need to convert the video to H.264 codec before iTunes can manage it

iSquint@OSX
videora ipod video converter@windows
ffmpeg/mencoder@linux

all free.
 
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