Thank God, my iPod is working again!
I thought I would open up the case, since I've got "nothing to lose" cuz it's been displaying the SAD iPOD icon for about 2 weeks already...
To my surprise, a piece of broken copper connector fell out as one side of the cover was lifted.

While I was at it, I also reseated the ribbon cables on the boards and hard drive.
After this, the iPod started working properly again! No problems whatsoever!
Oh well, at least now it's working again...
