IPod could not be restored because the firmware file could not be found

Question

Initial problem was no audio and skipping through songs at a rate of about 1 song per second.
Tried the 5 R's and that didn't help.
Installed iTunes 7 and then it wouldn't recognize the nano. Followed Apple's instructions when iPod not recognized, including uninstalling iTunes, uninstalling latent update installers, deleting the iTunes directory, clearing the recycle bin, deleting temp files, etc. Then reinstalled iTunes 7,
Plugged in my nano and Got the message, newer version of iPod software available, update software (version installed was 1.1.1 and newer version available was 1.2)? Clicked ok and that was the start of my troubles. That process failed and suggested that I restore to factory defaults (not exactly what I wanted to do, having to reload my songs, but went along).
Did a restore to factory settings and now get the message
The iPod could not be restored because the firmware file could not be found.
Anyone got any ideas how to update the firmware? I'm hopeful that a file can be downloaded to do this rather than sending in the nano to have it updated.
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After an hour of updating software and a couple of hours of reading the forums looking for the answer, my eyes hurt, it's 2:30am, and I'm frustrated to the point of throwing this in the trash.
My kids have a shuffle and a mini and I've updated software on both with no problems before. If I realized I would have to become a system admin for iPods, I would never have invested.
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Answer 1

Welcome to Apple Discussions!
Take a look at these two articles. The error messages are not the same, but they may help...
http://docs.info.apple.com/article.html?artnum=304309
http://docs.info.apple.com/article.html?artnum=301267
If not, post back.
btabz