I attended MacWorld this past summer and, as always, bought a few things. One of the items was called "Invisibleshield" by Protective Solutions, Inc. (www.theinvisibleshield.com). The product is a very thin protective film that you attach to your iPod. The stuff is incredible. At the show they had a sample of the film and asked you to poke a ballpoint pen through it. It was extremely hard to do. You then took a look at the models on display and it was hard to believe the film was actually on the product. The show price was approximately $16. While at the booth they offered to buff my iPod to remove some of the scratches. The gentleman spent about 5 minutes buffing my iPod and it looked significantly better. I carry my iPod in a case most of the time and the case actually scratches the iPod. Now it would have taken an hour or more of buffing to remove every mark, but I must tell you, my iPod looked much, much better.
I have a third gen model so they shipped me the film. In the package they request you go to the web site for directions. Initially the directions look a little overwhelming. However, in a nutshell they tell you to wet the sticky side of the film with soapy water and use a credit card to squeegee out the air bubbles. You are also assured that you can remove the film.
The application turned out to be easier than expected and the iPod looks fantastic. The film actually seems to reduce the remaining scratches. I don't recommend many products but this one is a winner. And yes, they have the Invisibleshield for PDAs, cell phones and other products.