When You tap the screen it doesn't respond?
What you can do for that is take off the Digitizer (clear part that you touch)
This youtube video should help
This is for a 2gen iPod touch but the idea is the same if you have a 3 or 4th gen
Try blowing on the connection and reconnecting it.
If that doesn't work you can always buy a new Digitizer from Amazon or Ebay
(Be careful as the home buttons do NOT come with the new Digitizer)
I am speaking from experience!
They can be $2-$3 on a good day but no more than $10.
There is also a plastic clip that is glued to the back of the Digitizer (that is called the bezel) this will not come with a new digitizer so remove it carfully!
Hope this helps!
This helped me.
If you do not have a "safe pry tool" you can use a small flat head screw driver. Be very careful since it's metal and not plastic which can cosmetically damage it.