Re: music on iPod
If you have your music on your iPod, there is no "official" way to transfer it back to your computer directly from the iPod. I've heard there are some hacks, but I don't know about them.
So, in order to not lose your music (if you are doing a clean install):
Burn all your music to a CD or a DVD (this is a good idea anyway).
You can then reimport it into iTunes afterward... look at Apples iTunes help.. it strongly recommends backing up your paid for/downloaded music files (as the AAC files, not as audio CDs) because if you do have a catastrophic event, you'd have to pay for everything again.
If you've just ripped your own CDs on the other hand, all you risk is the time and effort to re-rip everything.
Hope this answers one of your questions.