A warning from CNET: iPhone "Restore" does not delete personal data!
All iOS Devices don't either. When you are selling your ipod touch 4 on eBay or passing it to someone else, do you erase all your personal content on your ipod by restore setting?
Here is a video about erasing & deleting all viewable personal data after restoring on your iPod Touch, it support on iPod Touch 4, iPod Touch 5 and iOS 7.
Wondershare SafeEraser - Prevent Identity Theft When Selling Your Old iDevice
* Wipe EVERYTHING from iDevices: contacts, messages, photos, videos, apps, account info, passwords and other personal data
* Works with all iDevices - Jailbroken iPhone friendly and also compatible with carrier-locked iPhones
* Keep your personal information safe, permanently remove it with SafeEraser prior to disposing of your old iDevice
* Permanent data destruction; prevents personal data from being recoverable