If your iPod 4 freezes and you need to restart it, follow these steps:
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Hold down Hold and Home button at the same time.
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Continue holding the Hold and Home buttons after the slider to turn off the iPod appears.
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Let go when the screen turns black.
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Wait for about two minutes
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Hold Home and Hold button to turn iPod back on
If you need to reset your iPod to factory settings:
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Choose Settings>General>Reset>Erase All Content and Settings.
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Connect iPod to computer .
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Opt to restore to New Device.
Resource: About iPod