Geez guys, Graphic Converter can be used to make images smaller. It comes with every Mac nowadays. Just make sure you remove the Resource Fork before you save the image. You have this option under Save File As.
Imagine having to buy Photoshop for such a simple task...
Its normal. Sometimes my display shows a rainbow-ish streak, as if I smeared oil on a part of my iPod screen and light was passing through it. Its normal, and caused by heat. It goes away. Its not even the LCD screen that's the problem, but the plastic covering the LCD.
What's the point of having your iPod replaced if the model you get will show the same "problem", if you can even call it that? You're just going to whine and eventually they're going to cave and give you a new one, raising AppleCare prices and such.