how do you reset the ipod when ur locked out?

Try ALL steps in the article you linked to this forum, it has the steps you need to follow.

Forgotten Screen-Lock Passcode

Connect the iOS device to your computer and try to make a backup

iOS: How to back up

Then restore via iTunes. The iPod will be erased. Place the iOS device in Recovery Mode if necessary to allow the restore.

If recovery mode does not work try DFU mode.

How to put iPod touch / iPhone into DFU mode « Karthik's scribblings

For how to restore:

iTunes: Restoring iOS software

To restore from backup see:

iOS: How to back up

If you restore from iCloud backup the apps will be automatically downloaded. If you restore from iTunes backup the apps and music have to be in the iTunes library since synced media like apps and music are not included in the backup of the iOS device that iTunes makes.

You can redownload most iTunes purchases by:

Downloading past purchases from the App Store, iBookstore, and iTunes Store