I also posted this under my ipod's generation forum.
I read some other posts about 40G's stuck on hold which suggested hold down menu/play together and hold down menu/select together. None of these worked. Neither did toggling hold while menu down or toggle while menu/select down. I restored the ipod but it came up with the lock still "on".
Problem started when I changed the battery. The battery works and it was definitely a problem of battery not holding charge anymore. After installation the ipod immediatedly came up with lock icon on. Maybe I hit something inside to change status of lock? I thought I was careful. Any ideas?

Thanks for help!
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If u have the LOCK symbol on screen then u messed up the hold switch. Disassemble and verify, it shouldn't be too hard, it makes contact or not, it's a simple mchanical switch.
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