my ipod classic has the red x and apple cant help me

I have a classic 80gb ipod. I disconnected it from player and reset it because it wasn't working right. Once i reset it, the x came up. I reset it multiple times and nothing worked. I looked online for solutions and all that came up was hit it until the disk realigns for the hard drive or just restore it. I brought it to my local apple store and they told me what they tell everyone else, "we can trade it in for a refurbished one or give you ten percent for it." Well i went home and tampered with it and managed to get the red x to go away and it showed a picture of the connection cable and it said connect to restore. Once connected to the computer, it registered there was a device connected was unable to do anything with it from there. Once connected from there, it showed the old connection screen where its not fancy and is in black and white. I disconnected it, reset it, and repeated everything over. After another hour of messing with it, i managed to get it to the menu of the ipod and had to choose the language and everything over again, but the first letter in every word on my ipod was missing for some reason. Since it had the menu I figured i could have the computer pick it up and it did, but it showed I had 11kb of memory left and the hard drive was corrupt. From there I restored the ipod, let it update the software, and then it had to reboot. Once it reboot itself the red x was back again. Obviously the hard drive is still readable otherwise the main menu would not have come up. Whats going on?