How to set iPod as a portable hard disk
# Connect your iPod to your computer and open iTunes.
# Select iPod in the iTunes source list.
# Click the iPod options button in the lower-right corner of the iTunes window.
# Click the “Enable disk use” checkbox, and then click OK.
# Close iTunes and notice that your iPod appears on your Mac desktop or in the Windows Explorer on your PC.
# Drag and Drop files or folders in the iPod Drive.
Is there enough room on my iPod disk ?
When you attach an Apple iPod to the USB port, the computer recognizes the iPod as a Removable Disk just like regular USB drives. Start Windows Explorer and you will see an IPOD drive, right click the drive and select "Properties" - this will tell you the amount of storage space available on your iPod hard disk.
Another option to check the free space on the iPod, go to the iPod’s main menu, choose Settings, and then choose About. You can also view the available space in iTunes. Select the iPod, in the source list, and look at the bottom of the songs list. You will see space used and space available.
Uncheck the Enable disk use button if you don't want to use the iPod as a disk. If you leave this option checked you need to eject your iPod from iTunes before you disconnect the iPod from your computer.
Apple Video Tutorial | Putting iPod into Disk Mode | Using Your iPod nano