Restore Error Message (2009 iPod Classic)

I have a 2009 iPod classic.

When I plug it into my computer, iTunes, asks me to restore to factory settings.

I begin the process of restoring, but before it finishes it says that the restore couldn't be completed.

I've called an Apple product repair shop and they seem to think it's the hard drive that's broken and it's cannot be fixed short of replacing the hard drive.

Is this true? am i screwed or can this iPod still be salvaged.