I have upgraded successfully my old, not used ipod mini (2nd gen) to 32GB (was 4 GB prior to the upgrade). Additionally I changed the battery to a new one.
Transcend 32 GB 133x CompactFlash Memory Card
and replaced by it the original 4GB hard drive from Hitachi. The battery replacement is available here.
The biggest challenge was to open the ipod without destruction. There are nice tutorials on the steps to do to open and upgrade the ipod mini.
I will use the additional space to store loss-less files to my old friend ipod mini. Together with the Fiio E17 USB DAC Headphone Amplifier connected via FiiO L3 Line Out Dock (LOD) Cable For iPod and iPhone the quality on the headphone output is amazing. Now my old friend is back to operation and I have an mobile audiophile player.