I am going to sell my second generation ipod touch, so i resetted it to factory defaults. It said it would take up to an hour, and i patiently waited. But when the black and white loading bar completed, the ipod went to the black screen with an apple logo

I am going to sell my second generation ipod touch, so i resetted it to factory defaults. It said it would take up to an hour, and i patiently waited. But when the black and white loading bar completed, the ipod went to the black screen with an apple logo on it. Sounds about right, right? But now, there is a processing circle on top of the logo, but the circle spins once, and stops at about halfway to the bottom. It just stays there, and about every half to one hour it becomes a white screen and starts all over again. (not the loading bar part, just the circle). I've tried holding the power and the home button, and it works, but it just goes back to the circle screen with the apple logo. HELP PLEASE?