They might just advise you to get a new ipod if repair costs come close to the brand new price...
My 3rd gen ipod died on me a few months ago. A folder with a "!" sign comes out whenever i turn it on. There is also a crackling sound that can be heard. When I brought it to a service center, they said the hard disk is the problem. It might reach around 11k if I decide to get it fixed. They can't even assure me if all the songs will be retained. (Which I doubt)
Since a new 30gb ipod video costs around 12k, they advised me to get a new one. Ngayon hati nalang kami ng wife ko sa 60gb ipod niya... 30gb for me, 30gb for her... Yun nga lang, may backstreet boys at justin timberlake sa playlists if I play it on shuffle mode...