If you have an iSight, this updater will completely hose your G3 iPod. It hosed mine and made it completely unusable. To fix it I:
1) Disconnected my iSight completely.
2) Oped Disk Utility and formatted the iPod as a Mac OS X Extended (not journaled) drive.
3) Ran the iPod updater and chose Restore, which went a *lot* faster after I removed the iSight.
All was well. HTH.
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