I have a certain generation of iPod that has faulty grease in the hard drive. Sometimes the hard rive will start to click and you will get a "sad iPod" picture on the screen. What is actually going on is that the grease is gumming up and the read arm on the hard drive is sticking.
The solution? While it is turned off, hold the iPod vertically about three inches off the table and bring it down hard to give it a good solid WHACK along its base.
So, yes, you can fix your broken iPod by hitting it.
I actually had that happen with a medium format camera during a wedding -- took off the 120 back and a piece from inside the camera fell out! No idea what it was for and I was lucky nothing seemed to be wrong -- soon after that I replaced my system, however.