Ipod won't let me into wifi at all not even to select a network. It's been like this ever since I restored my Ipod 4g and it will not let me do anything, not even download music to my ipod, restoring it also lost all of my data

I knew that I needed to update my Ipod (4th gen) but it randomly stopped using the wifi and when I would go into "wi-fi" under "settings" the loading wheel would not stop spinning yet there are 5 wi-fi networks around me. Then I turn my ipod off, then on again and when it turned on it had an icon that was the itunes logo and a usb cord and that was it.. so I plugged my ipod into my computer got onto Itunes and it said that I needed to restore my ipod. I knew that all my data would be lost but now I can't even go into the wifi settings to select a network... it has the wi-fi connection icon(the little arcs) then "Wi-Fi" then across the bar thing it says "No Wi-Fi" I don't understand.. I do have Wi-Fi or else I wouldn't be able to type this on a computer....

How do I hook up the wifi network selections to my ipod???