First, run through the Apple troubleshooting suggestions:
http://www.apple.com/support/ipod/five_rs/shuffle2gen/
That is for an older version of the ipod, but I would imagine that it will give you some good ideas.
If none of that helps, I would suggest completely uninstalling all the Apple stuff and reinstalling. Go to add/remove programs and uninstall itunes and whatever else was installed for Apple - that includes their USB software.
Then, reinstall it all.
One other thing to try before doing all that is to shut down your computer and disconnect everything except for your keyboard, mouse and ipod. Then start it up again. If it comes up, then you know that some other USB thing on the bus was conflicting with your iPod. Also make sure you are connecting directly to the computer, not through a hub - just to make sure. If it works, then maybe try using the hub again. If it fails after that, you know it was the hub causing an issue. If it works, reconnect your USB items one at a time and restart after each reconnect until you find what was conflicting.
Hope that helps,
i