After charging overnight my battery would go to red line in a few hours.
The repair went very smoothly. The hardest part was getting the ipod apart. The 7 Philips screws were difficult. Of the 7, 5 came out ok, but 2 had head damaged by the time I was done.... but there was enough left to reassemble though, so all worked out well.
One important piece of advice. The ifixit instructions list a #00 Philips screwdriver under tools however I needed a #0000 Philips to get the screws out.
iPod touch (Gen 2) Replacement Battery
Soldering Iron 60w Hakko 503F