To conclude this overly confusing thread (for such a simple problem), JoeFloyd's suggestion works just fine. To summarize:
1) Open up Tascal Registry Editor and change "HKEY_CURRENT_USER/ControlPanel/Volume/Screen" to "0"
2) Soft Reset the machine by pushing the black button on the back with the stylus
3) Enjoy the audio benefits of a click-free environment
There may be a different solution for epods without either of the software hacks applied, but AFAIK this should always work. If you don't have one of the hacks, you will have to install Tascal - see www.geocities.com/epodsfiles
Also, if you want to mute the sound all together, you are best to use ezex (start->programs->utilities->ezex w/ hack) and turn on audio mute. That will get rid of the click and everything else.