Oh you saw that video that was made about 3-4 years ago. That was in great part anti- views propaganda - like a joke. I believe the new batteries are a lot better. Actually that issue has already been discussed on the forum before. Like camera batteries (same kind of battery), if you read the instructions & look after the battery then you'll get a good long life out of it. If you don't read how to look after it & have an any how to do attitude then the battery probably will only last you not much more than 18 or so mths. Knowing the battery recharging procedure is important. Like anything, look after it & it will last. And Apple do offer support & insurance for the batteries. It costs more but it means you can have an immediate replacement until the other is ready.
As far as iPod goes. Yes it plays all those formats that rkapsi mentioned, so it would be a very poor idea to convert an mp3 to an m4a format. That's like converting an mp3 to an mp3. Consider that mp3's have been reduced in size from perhaps 40 MB down to somewhere between 3-10 MB depending on the quality settings. MP3 throws away information to help it do this. If you convert mp3 to another "lossy" format, then you're unnecessarily throwing away more information & more quality for absolutely no reason at all. If you have an ear for quality sound, then you will notice a loss of sound quality. Particularly if you play it thru a high quality sound system where every frequency should be heard. But if the frequency is missing such as at the top & bottom ends then you'll notice it greatly. Just compare it to a CD of the same album/songs. Just my 2 cents.