I have version 2 installed. My computer is on the same network as the iPod. The iPod is not usb connected to the computer.

I open the Remote app and it gives me a code and says "To control iTunes, open iTunes and select iPod from the devices list".

I don't see iPod listed in iTunes?

Connect your iPod to your computer before pairing.

Do you have uPnP setup on your router?

hmm still doesn't work for me.

I'm not sure about uPnP

When I attach the iPod via the cable and I see it on the device list, what do I do next? The iPod doesnt update to show its connected in the app.

What router is it?

Yeah its enabled (d-link di-524)

This basically how it works:

You have the iPod connected to the computer via usb with iTunes 7.7 (a must for this to work). With it connected you should see the iPod like normal, now start the remote app on the iPod/iPhone and it show display a code, under the iPod you should see an icon that looks like the Remote icon on the iPod/iPhone, that is where you can enter in the 4 digit code into iTunes. After that is done you no longer have to have the device plugged into the computer, it just needs access to your Wi-Fi network and bam

That icon just doesn't appear for me

You aren't using a modified iTunes install, iTunes light or happen to have some of the iTunes services disabled by any chance do you?

I removed Bonjour...is it needed for it?

Just a guess but yes.

Re-install iTunes with Bonjour and you should be sorted.

While your iPod is connected via USB and appears in iTunes, run Remote and follow the instructions. A PIN should appear on your iPod and Remote should be present under your iPod in Devices in iTunes.

Installed bonjour and it works. Thanks guys.

Actually, just to correct myself earlier, you don't need to have your iPhone/iPod touch connected via USB, rather connected via Wi-Fi.

Yep, it's all done through Wi-Fi. Frankly, it's a bit pointless to use Remote while having it connected via USB

I never understood why people had problems with Zeroconf/Bonjour--it's a very useful service. It's installed by default on many Linux distros and OS X.

Useful for what? I don't use it for anything...

To quickly find connected devices on the network. Bonjour automatically picks up all of the networked printers that we have at work instantly. It makes setup simple and fast.

As exemplified above, it's used for zero configuration media sharing as well through iTunes, iPhoto, iChat, etc for music/file sharing.

It seems to be windows user mentality. If it's a service that doesn't come with windows, it must be bad, not matter how useful it is, or how little resource it consumes.

Anywho, it's a really light service, at least on OSX & Linux:
mDNSResonder (on OSX): 1.25MB
avahi-daemon (on linux): 1.49MB

EDIT: 3.3MB on Windows. Slightly heavier, but come on, it's nothing when we have computers with 1GB+ of memory.

Eh, mine doesn't work Same problem that you had, but I can't fix mine. I haven't removed the Bonjour service, or anything like that.

EDIT: Heh. All fixed

Oh yeah, I meant initially while setting it up, not to use.