My wife upgraded her iPod touch to iOS 4 and everything seemed to go fine. She went to change her home screen wall paper and she doesn't have that option. She can only change the lock screen. My iPod touch does have the option to change the home screen wallpaper so I know where to make the change. I also checked to make sure she was on 4.0 and she is. The launcher is also the new launcher so I don't know why the option to change the background isn't there. I tried to get apple support but they want me to pay for support. The closest apple store is over two hours away so hopefully I can figure this out.