While Apple first introduced its FaceTime video conferencing technology on the iPhone 4, it soon added the feature to the 4th generation iPod touch (among other devices). As with the iPhone 4, FaceTime only works on the touch when it's connected to a WiFi network.
Since all iPhones have phone numbers associated with them, making video calls from phone to phone makes sense. But the iPod touch doesn't have a phone number attached to it, so you have to create a FaceTime account to be able to place FaceTime calls to other iPod touches or iPhone 4s.
To begin setting up a 4th generation iPod touch to use FaceTime, tap the FaceTime icon in the top-left corner (unless you're re-arranged your icons, that is. In that case, find it where you put it) of the iPod touch's homescreen.
On the next screen, click the "Get Started" button.