The offer is legitimate and was featured on CNN.
The company does give out "free" Ipods. You can get a 20GB or one of the mini-ipods. Unfortunately the way it work is very simular to a ponzi scheme. You sign up at the website, and are presented with a selection of offers which you must select one. Then here is the annoying part... you must find five other people to also join. The good news however is that unlike a ponzi scheme you don't have to actually pay for anything... you just have to annoy other people.
I hate bothering folks with deals like this, however a 20 GB ipod is certainly worth annoying a few folks. Also a few of you might be interested in one of the offers and want to sign up for that reason alone. The free Blockbuster trial is worth it as you get two free movie rentals from a local store as well as the handful of movies you get directly. You can cancel prior to the free trial ending and pay nothing.
My Referal Link
Currently listed offers (I chose the Blockbuster one):