Well, whaddaya know? Steve Jobs has set up a replacement program for iPods with defective screens. This always happens for widely-known problems, but I doubt that the "serial number list" that Apple has deemed "defective" will cover every single one of the affected iPod nanos.
However, I think the problem is greatly overblown. I trust Apple, as a rule, even though they've made a few mistakes. I think the old adage "the squeaky wheel gets the grease" is applicable here, and the squeaky wheel of nano owners is probably a very small portion of the total purchases.
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