Place the iOS device in Recovery Mode and then connect to your computer and restore via iTunes. The iPod will be erased.
If recovery mode does not work try DFU mode.
For how to restore:
To restore from backup see:
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:
If problem what happens or does not happen and when in the instructions? When you successfully get the iPod in recovery mode and connect to computer iTunes should say it found an iPod in recovery mode.
If it is a 5G iPod with iOS 7 then yo will also have to enter Apple ID and password