I’m a very happy user of Rockbox on my iRiver H10, so after receiving an iPod as a gift, I was very disappointed that I couldn’t use Rockbox on it. Next, I found that Apple had decided to only support their own formats plus the mp3 format. I use a different format, so my 4Gb of audio files are unreadable to the iPod. How needlessly frustrating.
I strongly advise avoiding these devices. In general, to avoid frustration, avoid any consumer device when free software after-market firmware exists for that category of device but doesn’t work on that particular device. For digital audio players, you can check support at:
For details about the attempts to port Rockbox and iPod Linux to the iPod nano, you can find info on the "Nano 2G" thread on the Rockbox forum, and for datasheets, see iPod Linux’s Generations page. Porting efforts started in the 2nd half of 2006 and no one has yet gotten firmware to boot on these devices, so it looks unlikely that the problem will be solved soon.
One postive tangential discovery was the Songbird software which, although still in Beta, does a good job of organising music files.