PC thinks my iPod Touch is a camera

Whenever I plug my iPod Touch into its USB port, the PC (which is running WindowsXP) gives me a window with 3 choices. I can either "launch" 1) the ABBYY FineReader (which looks like scanning software), 2) the Microsoft Scanner and Camera Wizard, or 3) Picassa 3. I suppose there is a 4th choice which is to do nothing and that's what I usually do.

I recently upgraded to iTunes 10.5, which might've been a mistake. I don't recall whether my iPod showed up under DEVICES with the previous version, but I don't think I ever had any trouble finding it. Now, DEVICES doesn't even show up on the left-hand column in iTunes. I followed some instructions that were suggested for a question similar to mine. The result was that iTunes wanted to "Restore" my iPod, i.e. restore it to its factory settings and (I presume) wipe out any apps or content I already managed to put on it. It didn't show the "name" of my iPod or any other information about it, like I remember seeing on a similar screen on my PC before (most likely in the previous version of iTunes).

If I look under My Computer in Windows, the iPod is visible and even shows the "name" we gave it the way iTunes used to. The trouble is that My Computer recognizes it as a "Digital camera." If I double-click on it, I see the two pictures I've transfered from the PC to the iPod but nothing else. If I try dragging an mp3 file into that window, nothing happens.

So I suppose I have 2 questions:

1) How do I get my PC to recognize my iPod Touch as an iPod instead of a camera?

and

2) How do I get DEVICES to show up in iTunes without wiping out the existing Apps and downloaded content?

What I would really like to do is move some music and some podcasts from my PC to the iPod Touch, but right now all I can move are pictures. That is why this question has the title is does and I'm hoping answers to the above questions will allow me transfer mp3 files, which is my ultimate goal.

Thanks for any help anyone can offer!