can't close apps on iPod Touch 1G

I'm stumped. My iPod Touch 1G has been working just fine. And then two problems:

1. WiFi is suddenly greyed out for no apparent reason (unit hasn't been abused, misused, dropped, neglected, etc.). But No WiFi is all that shows under General.

2. The second problem is that apps won't close. You know, when you double-click the Home button and get a list of apps and their previews. Used to be able to swipe the preview up and the app would be gone. Now, there's no response. Swiping (any direction) works everywhere else. Just can't close apps. Which means the battery life is pretty low with all that in the background.

Tried: Turning the unit off (not just sleep, but actually off) doesnt' change anything. Once on again, those apps are reloaded in the background. Tried Terminal (no success, can't figure the names of the apps, and anyway, the iPod should just work as designed), have reset, restored, restored as new, blah blah blah, absolutely no change except all the custom folders are gone. Resetting the network changed nothing either. Still no WiFi.

Sooooooo.

If anyone knows how to fix either or both of these issues, I'd be very grateful.

Thanks.