This is in response to
turingtest2 "Corrupt iPod Classic"
https://discussions.apple.com/docs/DOC-10101
We had a similar problem with an iPod Classic stuck in recovery Ø and unable to be restored in mac iTunes. We tried this with two macs, and then a PC. We got the "error" message in Diagnostics Mode test of the HDD instead of the diagnostics report. There was a tip here to put the iPod into Disk Mode, after resetting (Menu/Select) and then by pressing Menu and Play/Pause whilst connected to the PC (Win 10) with latest iTunes. We were still in recovery Ø but that was OK, it said. Then we tried again to restore in PC iTunes. Suddenly it began to work, and after a bit the iPod WAS back in operation, now showing the out-of-the-box screen for setup (we actually thought the HD was finished!).
We then connected it to the original Mac and initiated a sync. It's 75Gb to download of music, but it seems that it's still working. The note about not syncing a large amount was noted, but not followed. We shall see.
While it's not sure what we did, but after putting it in Disk mode, it seemed that some software block or corruption was overrided so we could do the restore. Maybe?
Thanks for any enlightenment to us about this. Also, if this worked for someone else, then happy days.