Attempting iOS 3.2.1 update, iPad could not be restored, unknown error 1014

Question

Tried to update my iPad wifi+3G tonight. Got error message in iTunes:
The iPad "iPad" could not be restored. An unknown error occurred (1014).
I'm stuck now and can't use my iPad because the iPad goes to recovery mode, and when I try again, the same thing happens. Have tried about 6 times. One time, tried and I believe succeeded in getting into DFU mode - dark screen on iPad while iTunes said it had found a device in recovery mode - but that restore ended up the same way.
No iPad now. Bummed. Is this hardware? I hope not. Please help if you know anything about this. I can find very little about this error.

Answer 1

I am still unable to restore my iPad, and it is therefore still not usable.
Here is the loop I have been going around - NOTE - this is not a recipe for success here - I'm just describing what I'm seeing and doing detail, in the hopes there will be an additional clue here in how to fix things:
1) Select files in ~/Library/iTunes/iPad Software Updates/ and drag to trash (there is a single ipsw file). (Note, I also trashed my iPhone Software Update file from last night, on the thought there might be a cross-up somewhere - made no difference).
2) With iPad plugged in, showing "iTunes has detected an iPad in recovery mode" on Mac, and showing Recovery Mode graphic on iPad (USB cable -> iTunes), get iPad into DFU mode as follows:
Hold down iPad Power and Home buttons until iPad disappears from iTunes screen.
Release iPad Power but continue to hold Home until "iTunes has detected an iPad in recovery mode" on Mac, but now with a dark screen on iPad (no USB cable -> iTunes graphic on iPad)
3) Click Restore in iTunes, then click Restore and Update in the Are you sure… dialog in iTunes, then click Next, then click Agree in iTunes. iTunes shows Downloading 1 item, iPad Software Update (7 minutes remaining).
Note: iPad screen still dark all this time
After the download completes, there is a bunch of activity in iTunes, with messages like (probably didn't capture all these messages):
extracting software
verifying ipad restore with apple
preparing ipad
waiting for ipad
preparing ipad software
Eventually a long progress bar shows up on iPad
The progress bar starts to move with messages like this in iTunes (pretty sure I did not capture all the messages here):
Restoring iPad Software
Verifying iPad Software
Verifying iPad Restore
Finally, the iTunes dialog end up like this:
iPad:
Restoring iPad firmware…
and the progress bar on the iPad gets very near the end, but not quite. It sits there for maybe a couple of minutes.
Then, in iTunes, this dialog appears:
The iPad "iPad" could not be restored. An unknown error occurred (1014).
and on the iPad, the recovery mode dialog appears (USB cable -> iTunes graphic).
I've been around this loop a number of times now.
Not sure where to look for error messages in any log files on my mac.
Any other ideas?
Thanks for reading. Sad I don't have an iPad anymore...