Shoutbox

iTunes is really the best software for managing music for the ipod.  It can take a while to get used to, but I'd stick with it.

As for a converter, try the videora ipod converter.

I'd avoid converting them at very high quality.....you don't need high quality for a screen that is only 2 inches square....you'll just be wasting your memory if you do that.  I download videos straight from YouTube in mp4 format using keepvid for my iPod Touch and they are a perfect quality, at no higher filesize than an equivalent MP3 (with audio only)