Hope you dont mind me putting my 2 cents worth, I know this thread isnt technically allowed, and llorean might want to remove/move it.
Anyway, fishlover900, it sounds like the pc still has memory of the file/folder in use. Close Explorer and any other programs that might be linked to the file/folder, then terminate the process itunes.exe and ipodservice.exe (Ctrl + Shift + Esc).
Plug in the ipod, make sure the processes mentioned above are NOT loaded.
Open Explorer again, and try deleting the file/folder. Or run the ipod updater, itll overwrite everything anyway.
Good luck.