I have an Ipod Touch 3g 8gb from a friend. He said it got wet a while ago and just put it away in a drawer. He gave it to me and after a full charge it has powered up and seemed to display everything on screen without any issues. I done a itunes update to latest IOS and repaired the home button flex cable. However i did not check at the time but it will not play ANY audio or Video, when i try load anything from you tube i get error message "this device cannot play this file"

My guess is it has more serious damage from the water damage it received .

Any help/advice on this issue welcome