My iPod touch has just recently started to not want to turn itself off!
I have loaded the latest update to iTunes and also to 2.1. I have tried holding the home and on/off button together to enable a reboot but it will not reboot. I have done a reset but the problem still exists.
Do you mean that if you press the Sleep/Wake button (on top) the iPod does not go into sleep mode? If you hold it down, do you get to the "Slide to Power Off" screen?
I'm confused about your next statement. Holding the Sleep/Wake and Home buttons until you see an Apple logo is a reset of the device. Has that been successful or not? What procedure were you indicating by "reset"?
If you haven't already done so, you might try a restore in iTunes. Connect the device, select it in the left-hand side of iTunes and click the Restore button on the Summary page. I'd recommend letting iTunes back up the device prior to the restore to prevent data loss.
I tried the reset suggested and restore all to no avail. It appears to be a hardware failure. As the iPod touch was under warranty I have taken it back to the Apple Store and they have replaced it straight away with another refurbished unit which I am happy about. Thanks.