Unable to activate iPhone / Stuck in iTunes

Hey guys,
hopefully you are able to help me with this.
Got the old iPhone 4 from my father. I set it all up and everything looked fine except that the iPhone can't connect to my carrier (it says "no service" and is not even searching). So I contacted my carrier this morning to check if my new SIM-Card is activated - It is according to them (I'm not able to check the SIM-Card in another phone).
My next step was to do a backup, restore the iPhone and hope that it'll just work.
After connecting the iPhone to iTunes (11.1.3.8 on a PC) it now says "Activate iPhone - This iPhone is currently linked to an Apple ID xxx (the Apple ID I set up yesterday on the phone and NOT the one my father used!). Sign in with the Apple ID that was used to set up this phone". Perfect, I thought, despite I was wondering that I'm getting this message now (First time connecting this iPhone to iTunes I was able to get to the normal syncing options where I can restore and check for updates etc.)
After typing the correct Apple ID and pw, iTunes is displaying "Connecting to iTunes store" for a few seconds and gets back to the screen where it wants me to enter my Apple ID and pw. I'm not getting any errors.
It is no problem to connect to the iTunes Store via iTunes. iCloud is also working perfectly.
Any ideas why I can't get through the activation process in iTunes?
... or any suggestions how to solve this annoying problem?
Thanks in advance,
Phil

Kagey.... I figured it out. In iTunes...under "devices"...where it is supposed to say the name of the phone "Dan's iPhone". I just kept clicking in the blank space where the name was supposed to be and it finally gave me an option to type the name in. You have to find the "magic pixel". Keep trying....it'll work. I was persistent...

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Unable to activate iPhone / Stuck in iTunes

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