it's a pretty common nano 4g problem - but they are only similar and there is no common answer to that.
some can be fixed with scotch tape on the click wheel, others work when the click wheel is replaced (but not all), then a few work if the click wheel connector is cleaned and so on.
i have one of those frozen nano 4g that won't work with the "common tricks" - maybe i order a replacement part and try that.
the "fun" part is, that the touch sensitivity is still there - if the iPod "sleeps" and you slightly toch it - the light goes on