They have probably reset it to factory conditions in the first minutes they had your iPod. They know it is possible to locate it and they do erase before connecting because this can be done even if there is a code.. I had your problem with my iPhone and it was the same: no way to locate or erase it for 2-3 weeks. Then I stopped to follow it.
I hope you had a security code on it and or the data were cripted in some way.
As also Apple state the locating is more intended to find and iOD device left some were not stolen.
I have developed my opinion: they take your device to use it and do not even try to read any content, unless you are for some reason in a positiion that someone could be very interested to find information on your iPod/Phone/Pad.