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My book isn't advancing to the next chapter on my iPod.

Start your book playing and then tap the screen to view the progress bar that shows how much of the book has played. On the left side of the screen are a pair of arrows that loop around in a kind of a circle - labeled in the picture as "Repeat".
If that circle is blue with a small "1" in the circle, your iPod will loop one song (chapter) endlessly. If it's blue and configured without "1", it'll play all of your songs, then loop via the current playlist. If it's white, it will stop at the end of the playlist.
Tap to change these settings. You want it to be blue without the "1".