This is an odd one.

I have an iPod Video Enhanced (5.5 generation iPod). I used the command line ffmpeg on Linux to convert the FLAC files to AAC. This worked great, except it did not write any gapless playback information to the file.

So, I did some experimenting. I used XLD on my Mac to convert Pink Floyd's Dark Side of the Moon from FLAC to AAC, and synced it up to my iPod. And it worked. I had gapless playback.

Then I took the same files, I used dBPowerAmp's music converter to convert to Apple AAC. I then synced these files over to the iPod Video and played them. The first track starts to play and just as it's about to end, the iPod just reboots.

I have the target type set to quality, and the quality setting slid up to 127, using LC-AAC.