The iPod Reset Utility is an application that will restore your iPod. This application is really a last resort when everything else has failed and you can't get...
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— Will it fully restore my iPod Nano?
Yes, the application is used to restore your iPod but it's recommended to use iTunes because iTunes already contains the firmware backups if you have performed other operations of this kind in the past. Start the application, install iTunes, connect the iPod and then you can restore it.