So i was one of those guys, desperately searching through these forums and youtube videos to try and fix my restore problem. anytime i would try to restore i would get stuck on an error 1604. so i narrowed it down to a few key factors that eventually led to my overcoming of this error (after about a week of being s.o.l.) these are the loose steps i think that could overcome this error, but the funny thing is that, it doesnt always work. you have to do them over and over again until it finally randomly works. i tested this method twice and it worked. so check it out. 1. you absolutely have to have itunes 7.5, so check out the other posts on how to delete 7.7 or 7.6 and get to 7.5 2. do the reboot holding the power and the homekey thing, but make sure the screen is black when it enters restore mode. 3. restore BUT what i noticed is that the only way i got mine to work was to update and restore to version 1.1.5 or i am assuming version 2.0. i tried to make it 1.1.4 and it eventually went back to the 1604 error (which is why i know this works because i had to get around this error twice. 4. you will get the error 1604. then hit ok unplug the ipod and turn it off, hold down the home key and re-insert the cable into the ipod and wait for the restore pop up to show up. 5. restore and update again, and again and again and again. repeat this process by switching off using the homekey/power method and the homekey cable plug in method until you finally get past the "preparing ipod for restore" status bar. honestly, this method just worked for me 3 times in a row. you just have to be persistent in doing this over and over again until it finally restores your software BUT one last step: when the thing in itunes pops up saying it will re-boot in 12 seconds or whatever restore successful, wait like 3 or 4 seconds and unplug your ipod...if you get the itunes logo screen on your ipod just plug it in and wah lah, it will be recognized as a healthy restored ipod.