I thought this was an interesting topic to raise and I am sure you can do it. I saw a thread once on x86 forums about putting linux on an iPod. I was just curious what techniques people have heard about it and etc. I am planning on getting one of the color iPods on labor day so it piqued my interest.

One of my ideas for the iPod consisted of being able to password the iPod on start or if loaded on the computer or something to that effect. I was wondering if it's possible because I definetly would store more then just music on it.

Putting a password when it's plugged into the computer would be tricky. 

The problem is, once it's plugged in, it's basically a USB drive.  The USB drive can be read by anybody, so you're out of luck there. 

The only way I see is to encrypt data that is added (based on something with your computer, probably PKI-style).  Either invisibly (which would be tricky) or manually (just encrypt each file as it's added).  Unless you could write a filesystem driver for the iPod itself, you aren't going to be able to encrypt the music.  But you can keep your data safe.

A startup password for the iPod, again, will do you no good unless you could encrypt files based on that password. 

The moral of the story is dont put pr0n on your ipod. J/k man, I just felt the need to say that.