SetUp Wi-Fi On iPod Touch
You can connect your iPod to internet through Wi-Fi hotspot. Usually coffee shops, fast food restaurants or perhaps your neighbors will leave their wireless access point open for use. You will not be able to access a wireless connection that is password protected, that is why the owner of that network setup a password for their connection its to keep other people from using the connection. Connecting to a wireless hot spot that isnt Public is illegal in most states.
Get yourself a wireless router, they are less expensive, Set up your own password to your router and configure your iPod Touch to connect to that network. It should see your network and then just enter your password for your router and you will be online