Yes you do need to upgrade, and especially Upgrade to the latest version of iTunes on your Mac. And then, as expert User kenichi Watanabe informed another user with that issue,:
"The latest version of iTunes may hide the sidebar. If it is hidden, from the menu bar, under View, select Show Sidebar. With the sidebar visible. when you connect the iPod (to the same USB port used by your other iPod), does it appear in the sidebar, under DEVICES?
If it does not, I would shut down (power off) the computer and disconnect all USB devices including hub. Start up with only standard keyboard/mouse connected (if normally used). Do this to Reset the iPod
Run iTunes. Connect iPod to a direct USB port on computer."
"If the iTunes sidebar is visible, does the iPod appear in the sidebar, under DEVICES? If it does, select it there. The iPod's Summary screen appears to the right. The Restorebutton is there.
If you are able to do the above, click the Restore button. This will erase the iPod's storage, re-install its software, and set it to default settings."