I just now tried it again with my Classic: "Shutting down..." is displayed for about 20 seconds and that's it - no reboot.
I also tried rockbox_dev123's suggestion: I 'played' the /.rockbox/rockbox.ipod file and my iPod rapidly shutdown and rebooted with no delay on the shutdown, as opposed to the conventional, newly implemented slow shutdown.
Could there be a time-out issue?