Edit: Only noticed this was originally a post from 2010 lol. Will leave the information below incase it comes up in a search.
Hey, don't know much about jailbreaks these days, but I remember there was tethered and untethered jailbreaks, if it's tethered, use the same software you used to jailbreak it to get it past the apple logo. But if it's nothing to do with that, and I'm not sure if this will work or not for you, only done it on an iPod Touch 4G on iOS6, for me this method fixed a Recovery loop, but can also be used to backup any files and put them on your computer if everything goes well, or if that's even a thing you want to do. Not sure if you're on PC or Mac, I've only done this on a PC myself, but I'm sure there is Mac versions or alternative software.
Download Putty:
http://www.chiark.greenend.org.uk/~sgtatham/putty/download.html
Download WinSCP:
http://winscp.net/eng/download.php
Download SSH_RD_Rev03B.jar:
http://www.sinfuliphone.com/showthread.php?p=781514
In that link it mentions about needing to install 'JRE-7-Windows-i586-iftw.exe' for it to work, but you can try without it to see if it works.
Follow the instructions here to get access into your iPod (even if you don't want to backup files, see if the mnt2 folder shows, if not follow the next step):
https://github.com/msftguy/ssh-rd/wiki/Windows-How-To
If /mnt2 doesnt show, restart the instructions for Putty, and after typing in the root and password, (before typing mount.sh), enter in:
fsck_hfs -r /dev/disk0s1s2
It will go through a repair, wait till its done, and mnt2 should work. Try to kick out of the Recovery Loop with Tiny Umbrella, or restore with iTunes, hope it works.