You don't lose a redshirt like that. The basic rule is a student can play for four years and those four year must occur within five years of the student enrolling. Once five years have elapsed, the student has run out of eligibility regardless of how many years he played. A redshirt simply refers to the one year of the five in which the student was eligible to play but did not play.
In football, what counts as playing is being on the field for a single snap. Being on the field for one snap counts the same as being on the field for a 1,000 snaps. As was previously stated, redshirts are determined at the end of the year. If at the end of the year the player has played zero snaps, then he can be considered to have taken a redshirt and thus not to have used one his playing years. There is no requirement that the redshirt year be taken in year one. You could play three years, take redshirt, and then play one more year.
I think the phrase "burn a redshirt" is due to the practice of a player playing every year once he plays for the first time. If a player plays in year 1 (i.e., his freshman year), then he usually plays in year 2, 3, and 4, and so never uses the redshirt year (a year 5 redshirt is meaningless because the player has already exhausted his eligibility by that point). Only a small percentage of players take redshirt in their second, third, or fourth years. GT had a player - don't remember who - that did that recently. He played as a true freshman and subsequently took a delayed redshirt year a due to an injury.
