My problem is that ZiPhone always did what you described so I had to use the other software that was recommended. I just can't remember the name of it and I uninstalled it from my computer so I just can't find the name of it.
Wait a second, the name of the software is called iLiberty+ and it was version 1.2.0.65. That is the only Jailbreak software that has been able to Jailbreak my iPod touch. I tried using ZiPhone a countless number of times and I tried every which method with it, I could not get it to work. As for the constant text coming up, you can stop that. Plug your iPod into your computer with iTunes open. Press and hold the home button (the button on the front of the iPod) on the iPod touch for a long time. You should see the Apple logo come up, keep holding in the button. Keep the home button pressed until you see the iTunes logo, then let it go. Restore your iPod touch using iTunes and then download and install iLiberty+. Follow its on-screen instructions for Jailbreaking your iPod touch. Make sure that you have it install the wi-fi installer to make life easier.