iPod Nano incorrect Album Artwork display

Album artwork not matching correct album listed the same issue (I have restarted the iPod Nano 3 or 4 times (it is refurbished) always had the issue, and sound check does not work)

It has OS version 1.0.4 Mac, does that indicated that the refurbished iPod Nano came with bad hardware?

I also have an older iPod Nano (with plastic buttons) where the hold button just fell off (it had been in a drawer untouched for a month or so), it is not a refurbished nano, will Apple replace it?