Do you want to play any kind of video in iPod?

You mean any type.

You can enjoy DVD/VCD and AVI, MPEG, WMV, RM, RMVB, DivX, ASF, VOB video files in your iPod with few clicks.

Yes. Yes. It can be played.

I have a freeware tool for this.
http://www.ipod-video-converter.org/downloads.html

Key Features

It's clean and free, without any adware or spyware. It supports all popular video formats including AVI, MPEG, WMV (ASF), RM, RMVB, DivX, ASF, VOB etc. It's stable and fast. Easy-to-use wizard-like user interface helps you setup conversion process easily. The output video has excellent image and sound quality. ID3 Tag can be derived from the input files automatically. Batch Processing is supported, it can process an unlimited number of files at one time. Detailed HTML help file is included. The installing and uninstalling process is very easy.

Tips and Tricks

ID:
The ID3 is derived from the source file automatically. You can also edit the ID3 as you like while adding or editing conversion task.

More Files:
You can add more than one source files at one time.

Dragging and Dropping:
Source files (*.avi;*.divx;*.mpeg;*.mpg;*.wmv;*.asf;*.vob;*.dat;*.rm;*.rmvb) can be dragged from Windows Explorer directly. Even more, you can drag multiple files at one time.

Direct:
While viewing conversion settings in the information panel, you can click the file link to open the source file or play the output MP4 file directly.

Hustle Free:
While converting, you can click the minimize button to hide the program to System Tray. Click the icon in the System Tray can restore the program window.

Previewing:
While converting, you can preview the output video, but the conversion speed will be faster if you close the the preview window by clicking the button in top right coner of the collapse panel.

Problem Free:
You can check "Shut down computer automatically after conversion" while converting. It's useful when you are converting tons of video files at one time.