Hi Guys,
The problem seems to be the LAME encoding of the podcasts; however, the following worked for me...
1. Go to the podcast in iTunes, right click and select 'Create MP3 Version'. I only tried this converting to MP3, but I would imagine it'll work if you still have the default 'Create AAC Version'. If not, change this by going to Edit, Preferences, on the 'General' tab click on 'Import Settings' button, and in 'Import Using' drop-down menu select 'MP3 encoder'. Then you can right click on podcast again and 'Create MP3 Version' should be shown.
2. This will then create a new version of the podcast, encoded by iTunes, not LAME. However, it will become a music file, so it won't appear in the 'Podcast' list but in the 'Music' list. This is easily solvable though; you can get it back in the 'Podcast' list by going to the new version in 'Music' list, right click on podcast, select 'Get Info', on 'Options' tab, select 'Podcast' on 'Media Kind' drop down menu, click OK and the new version should pop back up in the 'Podcast' list.
3. Delete the old LAME (such an aptly named encoder!) version, copy the new version over into your iPod, and fast forward and rewind to your heart's content!
Sorry for the lots of words on a relatively simple task, but just wanted to make sure all things that could be different were covered, so no one had to resort to resetting their iPod when that won't solve anything! Hope my solution helps someone!