Here's the most common complaint posted in the Apple forums. "I charged my iPod for more than four hours and then when I turn it on, the battery meter says it only has about 25% (or less) charge. So I plugged it back in for ____ (fill in the blank with a huge number) hours and it still says very little charge."
Here's the good news: Your iPod is probably fine, fully charged, ready to play for many hours. I have kidded people that the "cure" for this problem is to cut a piece of black electrical tape exactly the size of the battery indicator and slap it over the meter on the iPod screen. Kidding aside, the battery meter is really only useful for one thing -- it is an approximate reminder of when to recharge. My 1st generation iPod has run for more than two hours with the meter showing empty, for example. My wife's 3rd gen always shows very low charge on the meter right after charging, but after using it for a while (sometimes as long as 20 minutes) it fills in the black bar and reads more like what's really in the battery.
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ankush