It appears that a number of users, myself included, were surprised to find that upgraded to iTunes 8.0 and then their iPod Touch to version 2.1 resulted in an unknown error (13213) and the delightful information that your ipod cannot be synced.
This message seems to continue to pop up randomly while your iPod Touch is connected even when no syncing of data was being conducted.
Luckily enough on the Apple Forums, a kind individual seems to provide the unique combination of steps to get iPod Touch 2.1 and iTunes 8.0 to play nicely together.
To restore syncing capabilities to your iPod Touch after a 2.1 upgrade:
1. Unplug your iPod Touch and turn it off. Hold the power button at the top until the red slider appears and power it down completely.
2. Quit iTunes 8
3. Relaunch iTunes 8
4. Plug in Touch – DO NOT TURN IT ON FIRST. Make sure it’s still off completely from step 1.
5. Should sync normally
Following this steps worked for me, although I must admit that I tried the “Restore iPod” approach first and that failed to work on its own.
I imagine Apple will release a fix shortly, but in the mean time, follow the steps above to restore syncing capabilities to your iPod Touch and be done with the annoying 13213 error.