IPhone 3G says connect to iTunes, once connected iTunes says: The sim card inserted in this phone does not appear to be connected. (even though sim is out of iPhone 4)

I Updated my 3g yesterday to ios 4, and now it says exactly what is in the title.
i have tried 3 sim cards all different networks, and one from an Iphone 4. none of them work.
is there anyway i can get this phone working again, i want to give it to my daughter.

I got it from work. They said it was O2. The last one was and worked fine
It was a phone that had a cracked screen that I replaced and won't allow me to do anything until I connect to iTunes but now saying the above.
When you say it maybe locked is this the phone being locked to work at all or locked to a network? Can I resolve this myself?
Thanks

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