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I just received email from Apple, Inc. (because I own an iPod nano 1st gen) that they are
offering a free replacement for units that contain a battery from a specific manufacturer. This seems to be similar to the replacement program they instituted in Japan, as far as I can see.

More information can be found on the Apple website:

http://www.apple.com/support/ipodnano_replacement/

One of the downsides seems (to me) that they first want you to send in your current iPod nano (1st gen), and then you should receive a replacement unit within 6 weeks. Rather long time to be without my iPod. Also, it does not seem to be clear at all what replacement unit one will receive... a refurbished 1st gen iPod nano with a better battery, or a random gen iPod nano, or a latest gen unit, etc...