Why Aren't My Purchases From iTunes Working?

I have a $25 itunes gift card. I redeemed it no problem, and I downloaded a couple free games. The free games show up on the applications section of my iTunes, and I sync my iPod AND press the button that says “transfer purchases to iPod” or something like that. Anyways the games are not showing up on my iPod 1st generation. So I figured that iTunes ws gonna make me buy something before I could get any free apps, so i attempted to purchase a crash bandacoot game for $5.99. It didnt work, I pressed “buy app” and i entered my password, then confirmed the billing information. Then nothing, it took like 2 sec to finish transfering to my iTunes library, but when i went to look for the game its not on my iPod or iTunes library. Also the amount of money on my iTunes card didnt change, it just stayed the same, $25. Does anyone know how to succesfully buy stuff and transfer it onto their iPods?