3.0.1 stuck my iPhone 3G in recovery mode

So, I wanted to sync a couple newly purchased albums to my iPhone today, and when I went to sync iTunes made me aware of a new update (3.0.1). Thinking why not I chose the Download & Install option.
It downloaded, but couldnt complete the install as halfway through it gave me an error stating that it couldnt update my iPhone.
I then realized my phone was now giving me the icon that says to connect to iTunes (icon with the iTunes and USB symbols). However, even though it WAS connected to iTunes nothing was coming up on iTunes about any kind of restore.
I tried hard resetting my iPhone to no avail as when I turn it back on it just keeps on coming back.
I have no option to do any type of restore, my iTunes isnt reading my phone (I know the computer is reading it, because I can hear the default USB connection sound when I plug my phone in) and I dont know what to do!
All help is appreciated as soon as possible.
All other details will be given if necessary.
Message was edited by: Inf4mou5
Gateway Windows XP