First you are going to need the movie or video onto your computer, this can be done by either downloading a movie from the interent or ripping a DVD, this format of course will not work on the iPod/iPhone so you are going to need to convert it, depending on your operation system (Mac/Windows) there are a number of programs you can use for this, on Mac my favorites are HandBrake and Quicktime Pro as they are simple and relatively fast. On Windows I also use Quicktime Pro but more oftenly a very good Program called "Magic Video Converter". Of course there are countless other programs that do a great job as well, and can be found with google.
After you have converted to the desired settings you should have an MP4 file, this you drag and drop to your itunes or directly to your device. Sometimes the file will not work on your iPod/iPhone and you will have to redo the conversion but this is not common, otherwise the video should work perfectly on your device and you can load as many as you want within the size limitations.
Another way that Apple set up which is a lot easier is to rent or buy the movie from Itunes and it is automatically in the MP4 format when you download and you can put it straight on to your iPod. Also with the new O.S. 3 that Apple came out with you can even rent or download movies straight onto your iPhone/iPod Touch without even needing your computer.