IPhone 4 keeps rebooting during final steps of restore...

I had an iPhone 4... never updated to ios 5.... When I first got the phone Nov 5th the following day I had problems with the screen not turning off (sensor not working) and 2 times the sound cut out on my phone.  I noticed if I turned my phone on and off sometimes it fixed the problem with the sensor. I took it to apple... they looked at it... turned it off and on... took my otter box off and tried telling me the problem was from the screen protector on my otterbox.  I've used the otterbox on every iphone I had and never had an issue.  I left the case on and just ignored the problem.  Earlier in the week the sound went out on my phone as it does every so often and this time it never came back on.  I made an appointment with genius bar... went in the following day. They said they needed to take my phone into the back to look at it. They came back and told me they opened it up and upon opening it they discovered it had water damage.  My phone has NEVER touched water.  I am very careful with everything I own and have never so much as dropped a phone.  They insisted upon the water damage and said I would have to pay 149 for a new phone.  I told them I needed to think about it.  I put the phone in my pocketbook and went home.  When I got there, the phone was off.  I plugged it into my charger assuming it died and went in the shower.  When I came out, my phone was still off!!  I went back to apple the following day.  I was told there was nothing they could do and that my only option was to buy a new phone.  I paid the 160 or whatever it came out to and went home to restore my phone.  Now, since it was a new phone, it automatically had ios 5 on it (which I do not want)... I restored my phone from the backup I did 2 days prior and I had NO TEXTS or APPS!!  This is a huge problem because I need to have my texts for work.  I have since tried to restore my phone 4 times from backups and the same problem.  Just as it's about to finish restoring and it gets to "Synching Apps to Mels iPhone (5 of 5)" the phone turns off and reboots... and continues to do so every minute or so.  I'm leaving the phone connected because it seems to still be putting my apps on the phone and I will see what happens when it completes but I'm certain it will be the same thing... no texts and no apps!! What is going on?  Is this a glitch between the old os and the new regarding the backups not restoring correctly??  helpppp!!!

Most apps are showing up but the install is incomplete on all of them.  And still no texts!

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