I am glad I'm not the only one with this problem!!!
Both my 2nd gen 8gig nano and my partners 4 gig pink 2nd gen nano generate this error.
Like Ikitten i have tried the usual restore with itunes and reformatting with Disk Utility.
When you run verify in disk utility it throws up the same error:
Verifying volume Rachs iPod
Checking HFS Plus volume.
Checking Extents Overflow file.
Checking Catalog file.
Checking Catalog hierarchy.
Checking volume bitmap.
Checking volume information.
Invalid volume file count
(It should be 182 instead of 142)
Invalid volume free block count
(It should be 713536 instead of 805069)
Volume Header needs minor repair
The volume Rachs iPod needs to be repaired.
Error: The underlying task reported failure on exit
1 HFS volume checked
Volume needs repair
Repair it and it will sync fine.. Then a few days later the error is back.
Its been driving me mad! I've sent feedback to Apple but have not received a reply. I've also dug around looking at other digit sync errors..People have solved some with replacing their dock cable,swapping USB ports etc?? None of these has worked for me. I even formatted my machine (2ghz intel core duo imac) so i could revert to itunes 6...It wouldn't allow we to sync either of the nano's without upgrading to version 7!
Your right It's seems to throw up the error less with auto sync with playlists as opposed to manual updating.
I'll try and go through my collection and remove any unusual characters from the song titles and albums, but really people shouldn't be expected to rummage through 1113 albums for punctuation!!! I'll let you know how it goes!