Thanks largely to those meddling kids at Japan's Ministry of Economy, Trade and Industry—who were investigating cases of people burned by too-hot-to-handle nanos—Cnet says Apple admitted today that some first-gen iPod nanos were overheating and said that it will replace any first-gen iPod nano that smokes or sparks (or blows up).
Apple says the issue has been traced back to a single battery supplier, and affects less than 0.001 percent of first-gen nanos. So if yours is bubbling or you're using it as a space heater for your pet mouse, hit up AppleCare for a replacement. There's a big question here though: If Japanese officials hadn't gotten involved, would they have made this announcement? I don't think so, even though it's not like exploding iPod nanos are an undocumented phenomenon.