Diagnostics mode - HDSMartData message "can't open device"

I'm having problem with my 4-year-old 80Gb iPod classic. At first, it started with some problems while I was syncing through iTunes like it suddenly freezed, the music files were not working or were playing then suddenly stopped and unable to play that file again after that. While charging recently, I also realized that the machine got very hot and this had never happened before. Just checked my iPod with the diagnostics mode, on the HDSmartData session and here it comes: "Can't open device" and on the bottom "error: diag halt". Is my iPod dead? Please show me if there's any other way to fix it? Have already tried formatted and restored it several times but still not working.