how to create apple account on ipod touch 1st gen?
Go to Settings>Store and try to sign in. You will have option to use existing ID or create a new one.
BTW, if you want to use apps, yu can update the 1G to iOS 3.1.3 by:
Purchasing iOS 3.1 Software Update for iPod touch (1st generation)
Very few app work with iOS 2
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