Thanks for the suggestions.
I have tried 6 USB ports on my main PC and 2 on another machine, both give the same result.
I have also tried 2 different cables, both does the same thing.
I have also tried using a previous version of iTunes that I used to sync the ipod but this just freezes too....I am starting to believe that the iPod is not compatible with windows 10 or something.
I found another suggestion that states to put it in Disk Mode and then format it using the right click method but when trying to do that the mouse cursor just sits "loading" rather than actually present a menu.
If I disconnect the ipod from my PC then the PC tells me the ipod needs to be formatted and asks if it should open iTunes but as soon as the ipod is connected again we are back to "square one".
It is becoming quite annoying.