I have an ipod video 60G which i bought october of last year.
I also got that error 1418 thing after updating to itunes 7.0.2. Everytime I try to restore, my ipod would stop responding, which ofcourse would lead me to unplugging the ipod improperly from my computer (Macbook Pro). I brought my ipod to an apple center after many tries and they were able to restore the ipod using an older version of itunes. Stupid me I reconnected the ipod to my computer again, hoping i could replace my music back into the ipod - then there it was again - ipod needs to be restored... error 1418.
I decided to uninstall my itunes and reinstall the older version. When i reconnected my ipod... poooof!.... the display went out, and i could no longer turn it on. In short, my ipod now is a piece of crap. It's hopeless because even Apple doesn't have a solution to it. Is this one was of eliminating the older ipods and making us buy the newer ones, which, honestly, doesn't seem to be practically better than the last ones?
I hope i could still revive my ipod. too bad It's out of warranty.
My advice: tell others not to download the new itunes yet.
Stop trying with itunes 7.0.2
Use the older version to restore.