If considering this, do it with a dead battery, cut off each batt lead individually & NEVER bend or puncture the battery cell itself! The mod involves cutting & bending the taped circuit board on top of the battery, not the battery itself.
'As commented, probably best to just sell the thing for parts... Maybe even sell the guts & mod the case (ala the EL iPod mod).
Step 1: Depending on the Problem(s), Consider NOT Trying to Repair an Old IPod
1) Dismal battery life. Was o.k. at time I checked it for the class action suit resolution, but has since gone kaput.
2) Lost ability to sync (massive firewire errors).
3) Lost ability to charge.
Upon opening found that the Firewire connector leads had wiggled enough to pull the solder pads off the main board & few had broken. So, off we go to the fruitless repair attempts:
1) Tried solder repair to firewire port leads (firewire port was in red box in photo). It worked for charging! .... For a day, then no more chargie.
2) Tried soldering in a new firewire connector (pulled from old card). Again it worked for charging! .... For an hour, then no more chargie.
3) Giving up on the firewire attachment area on the main board (solder pads gone), pulled the battery & mounted an LM317 voltage regulator ( LM317 tutorial ) providing 3.9 volts (R1 = 470, R2 = 1k I think). Using car adapter straight into LM317 input, it worked again .... For 15 minutes, then crashed hard & never booted again.
Step 2: Wouldn't This Make a Nice Conversation Piece?
Pull guts, cut unsightly battery wire, use clear packaging tape to attached battery to harddrive & notch top battery circuit board to fit snug w/earphone connector.
Warning: Assure you never puncture the battery itself! Nasty stuff inside...
Step 3: Fold Into Nice Triangle & Voila! a Geeky Piece of Desktop Art...
Nice thing too is that people can detach & unfold to look at all those discrete components on the main board (guess that's why it was $400 in 2001!).