Physically both 2nd and 3rd gen devices are the same however the 3rd gen has a faster processor and will support up to ios 5.1.1 whereas the 2nd gen will only support up to ios 4.2.1. Both support Bluetooth.
I also do iPod repairs. Send me a message if you are interested in getting an old iPod fixed.
Please keep in mind that the Fast 'N Free estimated delivery date is a best case estimate. Please allow at least a week for free postage. An Express option is also available at checkout if you need it sooner.