CNET today learns us how you can play video on your first, second or third-generation iPod by installing the iPodLinux OS.
In short, the iPodLinux OS will turn your iPod into a dual-boot entertainment center packed with video, audio, games, and other apps. There are stable versions of iPodLinux available for first- (1G), second- (2G), and third-generation (3G) iPods. Versions also exist for the iPod mini and fourth-generation iPods, but both are development versions, and they aren't supported by the iPod Linux Project.
Check out the guide at CNET. Keep in mind this will void your warranty