about her. and snow job. hundreds of planes grounded as a blizzard pummels the midwest. we bring you the latest on the developing storm. >> announcer: from the global resources of abc news, with terry moran, cynthia mcfadden and bill weir, in new york city, this is "nightline," january 12th, 2012. good evening. i'm cynthia mcfadden. think of it has a whole other holiday shopping season. only cheaper. while the yule tide spending binge may be over, there's a new reason people are rushing the stores, taking back those unwanted gifts. and with retailers facing record returns this year, approximately 550,000 items were returned from online purchases alone, many items are ending up in warehouses to be sold at steep discounts. here's abc's juju chang with the ways you can be cashing in for our series, "the new deals." >> muppets. nerf guns. this is definitely holiday returns. >> yeah. >> reporter: welcome to the graveyard of holiday gifts. inside this vast, generic warehouse in new jersey, is a giant discard pile. all those goodies we sent back to santa. oh, legos. but here, those rejects are reborn. this is the other end of santa's workshop. >> there you go. >> reporter: also known as liquidation.com. a booming business, that takes inventory from seven of the top-ten retailers and hundreds of manufacturers. and resells it at up to 40% off. executive vice president casey roy showed us around the warehouse, one of four they have around the country. >> we really transformed this industry. this industry would have been in swap shops or flea markets. the products in some cases would have gone to the landfill, which is really horrible. >> reporter: and this is their busy period. after black friday's early sales, there's the countdown to christmas. and now, the return season. 10% of all that holiday loot gets returned. online, it could be more like 15%. the liquidation business is profiting from the fact that retailers are making returns easier than ever, knowing you'll end up buying more if it's easy to return. and yet, there's that added incentive if you're going to allow people to make returns that might incentivize them to buy something else. >> they don't shop anywhere else. they become more loyal. and that loyalty is a key driver for retail success. there's a reason they do it. there's a real economic reason to having a liberal return policy. >> reporter: inside the electronic testing area, workers listen to these ipods to sort out which ones are broken and which ones can be resold. this guy is in charge of the x-boxes. you can have my son as an intern, if you like. and then, there's the long line of flat-screen tvs, which get tested, sanitized and wrapped back up in their boxes. these tvs are being sold to carmel harris, who comes to buy in bulk, up to three times a week. >> i bought two tvs at first. and then, you know, gradually bought ten. now, i get like 20 at a time. >> reporter: and now, you have a business. he resells the good tvs and fixes the broken ones. shopping them all on ebay or craigslist. >> the resale value is really good. >> reporter: carmel earns twice as much as he did at his old job installing car alarms. he's part of a growing economy, made of scrappy entrepreneurs, who know a bargain when they see it. this is a whole underground economy. >> it used to be underground. we brought it to life. because it's transparent. because of the high level of service we provide, it's above ground. and it's a thriving business. >> reporter: and it's not just home electronics. check this out. my kids would love this. air hockey. a battery car. you can bid on off-season merchandise, like 1,000 back-to-school backpacks. or a batch of purses by prada or michael kors. or ten wedding dresses. the winninged by, $375. >> people looking for that, that's what helps them. when people are more willing to buy an item that's a name brand. but they don't need to buy it from a name-brand store. >> reporter: the bad economy has made bargain-hunting cheap. >> it is. it's cheap, right? little blue boxes, is bargain-hunting. getting that deal. >> reporter: bargain-hunters don't have to buy by the truckload to get a steal. anybody can buy individual items on their consumer website. where you can save 100 bucks on an ipad, which normally costs $700. >> we have a punching bag here. we have a weight bench. and we have a manual treadmill. >> reporter: you have a full-on gym there. >> absolutely. absolutely. better price than someone else could. >> reporter: scott's truck is full of housewares, lighting fixtures and the ultimate holiday leftovers. >> we have a christmas tree. nobody wants this time of year. but we're happy to store them in our warehouse. >> reporter: and you keep them until november? really? today's trash is next season's treasure. for "nightline," i'm juju chang, in cranberry, new jersey. >> nothing like a leftover christmas tree. well, she's sticky and sweet and mother of four. and she's in the house, with new music, a new film and a new boyfriend. oh, my. the money i save with progressive lets me do some pretty cool things. buy people gas. come on around, we'll fill up your tank for you. pay their baggage fees. you're so kind! thank you. even pick up their parking. i'm just saving it forward. this parking's on me. tell 'em the messenger sent you. so i'll be out there sharing my savings with the people i meet. hmm. been looking for this since albuquerque. saving it forward. now, that's progressive. i took some steep risks in my teens. i'd never ride without one now. and since my doctor prescribed lipitor, i won't go without it for my high cholesterol and my risk of heart attack. why kid myself? 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[ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa, and the aerospace industry in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. >> announcer: "nightline" continues from new york city, with cynthia mcfadden. she is a true american original. trend-setting, mind-bending, madonna. an icon for the past three decades, if sometimes a controversial one. she is tiny, in person. but her accomplishments are huge. she is quite simply the top-selling female recording artist of all-time. you might think that would be quite enough. you'd be wrong. she's busier than ever. on february 3rd, a film she co-wrote and directed called "w.e.," opens. two days later, she performs at the super bowl. the last time we saw the reigning queen of pop, it was on her eighth tour. aptly named, sticky and sweet. doing it all, from jumping rope. to her signature, "vogue." ♪ vogue >> reporter: she's come a long way since "like a virgin." now, the best-selling female roarke artist in the 20th century is about to go on tour again. and just signed a music deal reportedly worth $40 million. are you buying lunch? >> that's what it says. $40 million. nobody handed me $40 million. i don't know about that. looks good on paper. >> reporter: it sure does. but that's not all she up to. >> and walk. >> reporter: madonna is also directing her first feature film. >> perfect. check the gate. >> reporter: directing seems to come naturally. she even directed us. >> you want the light up? >> reporter: i like that. your director thing kicks in. >> yeah. move. now, we're both in the light. >> reporter: the film, which she also co-wrote, but doesn't appear in, is called "w.e." >> happy birthday, w.e. who is w.e.? >> reporter: it explores the controversial love story of king edward viiith, and wallis simpson. >> your family won't stand for it. the prime minister won't stand for it. >> then, i'll give up the throne. >> and i'll be the most despised woman in the world. >> reporter: indeed, she was. edward gave up the throne for the woman he loved in 1936. have you ever been loved like that? >> i certainly have fallen in love with people who were willing to make big sacrifices for me. possibly not as big as i would have liked them to make. and i have made very big sacrifices for people that i have loved. and the great discovery i made whilst doing this research is there is no such thing as perfect love. and i obviously know that in the back of my head. i'm not an idiot. but, you know. i have my hopelessly romantic, strangely naive moments. >> reporter: you're a romantic? >> i am. sorry. >> reporter: still? after all these years? >> why not? yes, i am. >> reporter: madonna's love life has had its own ups and downs. it's been three years since her highly publicized divorce from guy ritchie. her new louvre, 24-year-old dancer, brahim zaibat. there's a lot to talk about. >> boring old. okay. what do you want to know? >> reporter: why? >> i didn't write down on a piece of paper, i'm now going to have a relationship with a younger man. it's just what happened. you see? that's the romantic in me. i just met someone that i cared for. this happens to be his age. >> reporter: and what's appealing about it? >> i'm not so comfortable with this conversation. but, you know, i don't want to live my life on my own. i love being a mother. my children fill me up in many ways. and inspire me in many ways. but i need a partner in life. i've never lived a conventional life. so, i think it's quite foolish for me or anyone else to start thinking i'm going to make conventional choices. >> reporter: how are things going with her new beau? >> i'm the easy one. >> reporter: i believe you. millions won't. are you the easy one? >> i don't know. i go home. and i wash my face. and i put on my sweat pants. and i lay down on the bed. and i say, oh, please, rub my feet. and he says, no. you rub my feet. so, you know. behind the curtain, i'm just like everybody else. >> reporter: but she's also a master of controversy. the film dives right in, with sparks flying about whether the duke and duchess of windsor were, as has been widely reported, nazi sympathizer. you could have size side-stepped the issue. why didn't you? >> i think it's something that was a shadow they had to live under. that's a huge, libelous accusation. >> reporter: but what about the pictures proving the couple met with hitler in 1937? >> i do not believe they were nazi sympathizers. they had a meeting with hitler. but so did lots of heads of state. i think people started to spin this tale and this yarn. and it was easy for people to put that label on them. >> reporter: despite what our fbi may say, in retrospect. >> first of all, the fbi is notorious for lying. and second of all, there is actually no impeerical evidence that they were nazi sympathizers. and you won't be able to give me any evidence? >> reporter: do you end up liking her? >> i love her. i see her as a human being. >> reporter: do you identify with her in some ways? >> of course i do. i identify with her ability to survive against all odds. i think she was deeply, deeply misunderstood by people. and i think, obviously, i can relate to that. >> reporter: she can also relate to the fame and the infamy. this is her movie. this is her life. the cameras are so intrusive. and the paparazzi. all of it is so breathtaking in a kind of way. is that how it feels to be on the other side of those cameras? >> sure. there's a certain aspect to the cameras that feel like a weapon is being pointed at you and shooting at you. is it exhausting sometimes? yeah. do i get to stand at the end of a red carpet and feel dizzy? and like i need to lay down and drink an alka-seltzer? sometimes it does, yeah. but i'm not in a position to complain. it's a high-class problem. >> reporter: she has many of those. like what is she going to do at the super bowl at halftime? stay with us. ♪ ♪ baby, baby, come along ♪ baby, baby, come along with me ♪ [ air horn blows ] ♪ i love you and i need you ♪ just to hug and squeeze you ♪ baby, why can't you see? [ female announcer ] the space of a small suv. the fuel efficiency of a prius. ♪ well, baby, can't you see the all-new prius v from toyota. ♪ come along with me not quite knowing what the next phase was going to be, you know, because you been, you know, this is what you had been doing. you know, working, working, working, working, working, working. and now you're talking about, well you know, i won't be, and i get the chance to spend more time with my wife and my kids. it's my world. that's my world. ♪ we're back, now, with madonna, who is crazy busy these days. balancing four kids, a new album, and a new film. did i mention a little thing called the super bowl? the public has all kinds of images of madonna in its collective head. the material girl. "express yourself." or save the world in four minutes. ♪ yeah >> reporter: but what's most precious to her these days happens out of sight. her role as mother to four kids. lourdes is the oldest at 15. do your kids ever say, mom, you're just not cool? do you get the eye roll? because i get a lot of the eye roll lately? >> they do not say it's not cool. but my daughter will say, that's inappropriate. you're not dressing like that. and sometimes, she's right. >> reporter: because it's too -- in what way, inappropriate? >> i went to the screening of my film the other night. i was feeling fun and frivolous. and i put on this beated corset, and fish nets. i put a cape on. she came into my dressing room. she said, mom, what are you doing? i said i'm going to the screening of my film. she said, that's not director. that's not director. take it off. that's inappropriate. really? i just -- okay. she was right. she was right. i changed. and i put on a better outfit. and i liked it. >> reporter: the day of our interview, she was racing off to a dance rehearsal. what's happening now? >> i have 250 dancers waiting for me right now. and i -- >> reporter: are they auditioning? >> yes. they're auditioning for me. >> reporter: for her much-anticipated halftime show at the super bowl. what's more frightening? having the movie open, or performing live at the super bowl? >> the super bowl, for sure. >> reporter: have you planned out what you're going to do yet? >> i'm in the process of doing that. i have eight minutes to put on up the stage. 12 minutes for my performance. and seven minutes to take it down. that's the challenge. how do you do that? >> reporter: do you have an idea of what you're doing? >> i do. and a few things have been shot down because i can't do things that block sight lines. and i can't -- >> jump out of a plane? >> no. there's a roof on the stadium. >> reporter: well, that wouldn't work then. that would be an ugly conclusion. >> that would be painful. i actually wanted to have 100 drummers come from the ceiling. >> reporter: i like it. >> that's cool, right? >> reporter: yeah. >> drum line from the ceiling. but can't take the weight. i know. so, there's a lot of that. i have ideas. i get like -- oh, my god. this is amazing. and no, that's not going to work. >> reporter: something tells me the director, singer, icon, mother, will come up with something spectacular. such pressure. i'll have much more with madonna tomorrow, starting with "good morning america." and later, on "20/20." she tells me what she really thinks about lady gaga. and finally, tonight, don't be fooled by the mild weather the country has had so far this winter. tonight, the midwest is being pounded by a major snowstorm, dumping up to eight inches of snow in chicago, milwaukee, and st. louis. over 500 flights have been