What does redeem mean on an iPod?

Answer 1

You must be viewing the iTunes app on the iPod Touch. The 'redeem' feature is used when you want to add iTunes cards to your iTunes account. This allows you to do it while you are on your iPod, so you do not have to be connected to iTunes.

Answer 2

if you have an iTunes gift card you click redeem, enter the code on the back of the card and then it puts the amount on the gift card into your account for spending on music/apps