Finally figured out how to get iTunes to update the new version correctly! Even when I deleted the old one and replaced it completely with a new uncorrupted one, it wasn't working. In the end I had to:
1. Delete the file from iTunes.
2. sync iPod (so that it would delete the old version from the iPod)
3. Add the file back into iTunes.
4. sync iPod again
If I didn't do step #2, then it wouldn't recognize the change and would just leave the corrupted version on there.
So anyway, it's loaded up, but I haven't listened to it yet. I'll be back to comment on it once I have.