Microsoft has resolved the glitch that caused older Zunes to lock up, bringing them back from the dead.
2008 carried both an extra day and an extra second, but no-one at Microsoft thought to tell the Zunes. In an echo of the Millenium Bug, the older Zunes - typically 30GB models released in November 2006 - simply couldn't cope and threw up all sorts of weird glitches. The Microsoft forums were snowed under by complaints on December 31st. Escapist editor Susan Arendt shared her frustration over her bricked Zune with The Watercooler.
With the New Year comes the thaw though, and Microsoft has advised that by just charging it up to full and resetting the date to January 1st they should be all right. [I actually didn't have to change the date on mine at all, just charged it back up again - Susan.]
This seems to have fixed most, though not all, of the problems, but it's such an easy fix it's well worth trying before using any official Microsoft repair channels.