Time Zone resets to Cupertino - repeatedly

Question

I noticed that the clocks showed incorrect times and then found that my time zone had been set to Cupertino - I live in Switzerland. I try resetting it many times but it still jumps back to Cupertino. Now I can't set alarms and many other things gets screwed up! I reset the phone once and got the latest build I guess of the iPhone 2.0 software.
How do I get back to the older version? Is there a fix for this problem?

Answer 1

"mee too". I don't have a solution, just the same problem with more data.
I believe that the problems began when I updated to itunes 9.
two iphone 3gs, one US at&t, one French Bouygtel. same apps on both.
two different macbook pros running os10.5.8, itunes 9.0.2
variables:
at&t phone - (date & time: set automatically: off, time zone set manually to Paris)
french phone - (auto set function does not exist, time zone set manually to Paris)
laptops - itunes (preferences:devices: Prevent ipods and iphones from syncing automatically is checked) computer timezone set to Dallas)
as soon as a usb connection (either mpb) is made and itunes recognizes either phone (before syncing), the phone time zone changes to match the computer (phone time zone shows Houston).
other info:
on the at&t phone if "date and time:set automatically" is on, the problem does not occur. the phone remains slaved to the network time signal.
if itunes is not running when the usb connection is made, the problem does not occur. as soon as itunes launches, the time zone resets as before (even before syncing).
apple tech support did not have any solutions. if you have any additional input, please let me know.