Hi Macca,
You may have a HACKED PLAYER. This is where they seller has hacked it to show more memory (4GB) than that is currently installed on your player (1GB).
So you formatting it doesn't help resolve the problem?
The other thing I can suggest is:
1. Another USB cable in case the USB cable is faulty.
2. Try following the instructions on this page here:
How To: Removing Memory Hack. See if that happens.
Let us know how you get on.