How do I get my audiobooks to show up in the "audiobooks" menu of my
fourth generation 20G iPod, by using iTunes 6.0?

Details:  I have created playlists and folders in the iTunes source
list called "audiobooks" but instead of the books I put there going to
the Audiobooks menu on the iPod, it creates a new playlist called
audiobooks under my music category, and leaves the iPod Audiobooks
menu option empty.  I have tried labeling all the books with the genre
"audiobooks" but they do not automatically register in that category.

http://aldoblog.com/audiobooks/itunes/importing-audio-cds/

They need to be

a) AAC
b) In the M4B format (that tutorial tells you how).