Forcing an iPhone or iPod touch into recovery mode
When Apple released iPhone OS 2.0.1, iTunes installed the update on my iPhone without any trouble, but it refused to update my iPod touch, insisting that version 2.0 was the latest. I tried restoring it but got an error message saying "resource not available" (or something like that).
I thought the problem might be that I had been using the iPod touch for application development and therefore was running the final iPhone OS 2.0 beta (build 5A345) instead of the "official" 2.0 release. I even tried purchasing the official update, but for some reason I was unable to download it. (Fortunately, an iTunes Store support person refunded my $10.)
As it turns out, I wasn't the only one having this problem, and one helpful forum user eventually discovered a solution, which is to force the device into recovery mode. By following Apple's instructions, I successfully updated my iPod touch to 2.0.1 (although I didn't try restoring any backed-up data, since I use the device only for development and don't sync it with iTunes). This procedure should work for iPhones, too, so if you've been unable to update your device by the usual methods, give this a shot.