iH8Sn0w have released a great new tool which will help solve all your restoring and downgrading whoes when you get the 16XX (any error in the 1600s) and the error 21.
This tool is called iREB and is compatible with the iPhone 2G, 3G and iPod Touch 1st Generation with firmwres OS 3.1.
There is a Windows version and a Mac version.
It is simple to use. Once you get the error open the program and follow the on screen instructions.
Click to download:

The DRAG TO HERE file is just an empty text file for me – not a folder. Tried unzipping with archive utility as well as stuffit. Any help?
I’m sorry but I don’t understand your problem. You simple download the file, extract it using WinRAR and double click the .exe file.
If there is something I am missing, please tell me
He is talking about the MAC version. I have the same issue, and I am also looking for the solution.
What about iPod Touch 2G??
It’s not compatible yet.
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