There's arbitrary execution on the iPod Nano 4G, but the storage is inaccessible so you're limited to being able to poke around in RAM.
On the Nano 5G...there's...nothing I'm aware of. Though its highly possible that one of the multitude of iOS tethered jailbreaks could possibly bear fruit.
The real issue with either device, however, is that there's no one doing anything with either.
Even if there was a workable exploit and a clear path to an end goal, there's no one actually doing the work.
[Saint]