IPhone will not update (error code 1) will not restore even in DFU mode (error code 1)

Question

I bought the iPhone 4S from a friend, and I came to wiping it manually from the handset, no problems found however during the initial steps the iPhone was unable to validate on the apple servers (with the carrier stuck on searching). So, I plugged the phone into my trusty laptop installed Itunes fresh and proceeded to restore. The process gets to the later part of the validation and throws up an Error Code 1.
I'm aware (from searches across the internet) that error code 1 is typically found in phones with tampered hardware/software e.g. Jailbreak, unlock etc. My friend is not tech savvy and doesnt have a clue about these things so I'm sure the phone is 'as is'.
So i proceeded to troubleshoot the issue:
I edited my hosts file to point to the apple validation server (and checked it allowed connections to gs.apple.com within my browser - successful).
Now as the handset is stuck in recovery mode (with the usb and apple logo) I tried to restore via regular Recovery mode - no sucess (error 1)
Entered the phone into DFU mode (which, in essence ALL of google preaches is the way to restore regardless of issue) same error occurred.
So i looked into 3rd party applications that could force it to restore or perhaps allow a functional end product.
Redsnow (latest edition only provides restore for up to iOS 6.1.somethingorother) that produced a dead end.
Pangu restore facility (latest edition for iOS 7/some 8 models) hanged at the same place as the apple loader.
I've tried flushing my DNS cache, and verified the Date/time on my computer and router is correct.
I refuse to accept the phone is nonfunctional but am rapidly running out of ideas as how to
a) restore it to the iOS it initially had
b) update it forcefully and have iOS 8
c) install a custom rom in the hope some fuctionality exists enough to restore it again.
Please inform me of any suggestions you might have,
regards Jack.
PS. Further information; This has been attempted on 2 seperate windows workstations both running windows 8.1 up to date.
The USB cable is an unofficial one but has caused no issues in the past on another iphone that ive restored.

Answer 1

Do you have the latest version of iTunes? Did you check for anti-virus software? One of the sections talks about interference from anti-virus software and firewalls. Also, you should not have to make any changes to your Host file unless your computer has been used to jailbreak a phone. I worry because you were using a number of software applications that are designed for jailbreaking devices. Excerpt from this support document. Get help with iOS update and restore errors - Apple Support
Check for hardware issues
Related errors: 1, 3, 11, 12, 13, 14, 16, 20, 21, 23, 26, 27, 28, 29, 34, 35, 36, 37, 40, 1002, 1004, 1011, 1012, 1014, 1667, or 1669.
These errors mean that your device or computer might have a hardware issue that stops the update or restore from completing.
Check that your security software and settings aren't blocking your device from communicating with the Apple update server.
Then try to restore your iOS device two more times while connected with a cable, computer, and network you know are good.
Make sure that your security software and settings are allowing communication between your device and update servers.
If you still see the error message when you update or restore, contact Apple support.