It will first do a backup of everything on your touch and then it will erase the device. Once it's done installing the new software iTunes will restore all your stuff.
what do you mean by a "backup"? will it save the apps i got from unlocking it as well?
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But the file I downloaded is called iPod1,1_2.0_5A347_Restore.ipsw.zip, isn't it? I mean, that's what the filename was.
Anyway, the updates seem to be working fine now. iTunes is currently downloading my update as I'm typing this.
You may notice one bug of transferring purchased apps from the iPod Touch/ iPhone 2.0 to the iTunes library.
It will first do a backup of everything on your touch and then it will erase the device. Once it's done installing the new software iTunes will restore all your stuff.
what do you mean by a "backup"? will it save the apps i got from unlocking it as well?