Restore to Software Version 1.1.1
1. Download this file from Apple, and save it to your Desktop.
2. With your iPod connected to your computer and iTunes open, select your iPod from the DEVICES list. In the Version section of the Summary tab, hold down the shift key (OS X users hold down the option key) and click the Restore button.
3. In the window that pops up, select the iPod1,1_1.1.1_3A110a_Restore.ipsw file that you downloaded in step one. Then click Open.
4. And now your iPod will restore to version 1.1.1
5. Once the restoration has completed, you’ll be prompted with a dialog box. Click OK.
6. When prompted select Set up as a new iPod and click Continue.
7. Give your iPod a name and decide how you want to sync files. Click Done.
8. Check the Software Version: to make sure that it’s now 1.1.1.
Now you’re ready to jailbreak your iPod Touch - continue on with the Jailbreak your iPod Touch section.