I bought a new gen 7 iPod Touch for when my gen 6 fails. Will I get the onscreen instructions to set it up?

Keep in mind that if you plan on storing this new Touch for an extended period of time, you still need to keep an eye on the battery. You should make sure that it's at least 50% charged. If it drains completely and sits in that state, it may permanently damage the battery:

Batteries - Maximizing Performance - Apple

Store it half-charged when you store it long term.

If you want to store your device long term, two key factors will affect the overall health of your battery: the environmental temperature and the percentage of charge on the battery when it’s powered down for storage. Therefore, we recommend the following:

• Do not fully charge or fully discharge your device’s battery — charge it to around 50%. If you store a device when its battery is fully discharged, the battery could fall into a deep discharge state, which renders it incapable of holding a charge. Conversely, if you store it fully charged for an extended period of time, the battery may lose some capacity, leading to shorter battery life.
• Power down the device to avoid additional battery use.
• Place your device in a cool, moisture-free environment that’s less than 90° F (32° C).
• If you plan to store your device for longer than six months, charge it to 50% every six months.

Depending on how long you store your device, it may be in a low-battery state when you remove it from long-term storage. After it’s removed from storage, it may require 20 minutes of charging with the original adapter before you can use it.

JR5280 wrote:

I appreciate the what/to/do and how/to. I wish I had known to asked this question 2 months ago when I bought the new iPod. I will follow the instructions and hope to save the battery. Thank you.

Two months is probably not enough time for concern. Most devices come at least partly charged. I'd worry if you never opened it and left it for a year or two.

Best of luck.

Yes, you will gets steps for setup.