I'm far from an expert, but if I were you, I'd first look at what's in the iTunes Music folder (C:\Documents and Settings\yourusername\My Documents\My Music\iTunes\iTunes Music) and see if there were any duplicate folders that could be easily deleted.

If not, I'd be very tempted to just download whatever music files are on my iPod into that folder (after deleting what's there now), and seeing what happens.

Of course, I'm assuming you have only music files.