If you do not know how to put your iPod Touch into restore mode follow the following steps:
Connect the iPhone to iTunes. Make any needed backups.
Put the iPhone into DFU mode. Do this by pressing and holding both the Sleep/Wake button and the Home button for 10 seconds. At this point the screen will turn black, and the iPhone will appear to be off.
Keep holding it untill you see a ' Connect to iTunes' image.
A pop up about iTunes recognizing a phone in restore mode will appear, press ok.
iTunes will now display a screen with just the restore mode avaliable.
Download the firmware restore file for 1.1.4 here. Remember where you put this file and do not decompress it.Press the Shift key and click Restore. A file browser window will open. Navigate to where the firmware file was downloaded, select it, and click Open.
Various messages will appear while the 'never ending' process continues. After it finishes, click cancel to activate the iPhone through iTunes.
Eject the iPhone from iTunes and close iTunes.
These are instructions on how to jailbreak your iPod touch using iLiberty+ and Windows.
Download iLiberty+ 1.2 from here, or here to your desktop.
Double click the downloaded file (iLibertySetup_184.108.40.206.exe) on your desktop to launch the install program.
Click the Next button to begin installation. Step Four
Select the location to install iLiberty+ in and click the Next button.
Enter a name for the iLiberty+ Start Menu Folder and click the Nextbutton.
Check the box if you would like to add a iLiberty+ icon to your desktop then click the Next button.
Finally, click the Install button.
Once installation is complete you will be given the option to launch iLiberty+. Check the box next to Launch iLiberty+ then click the Finish button.
iLiberty+ will open onto the standard tab. Check the operations you would like to perform. If you are jailbreaking an iPod touch then you only have to have Jailbreak selected.
Click to select the Payloads tab. From here you can select additional payloads to install while jailbreaking. We will leave this alone for now and go back to the Standard tab. Note***: A tutorial on how to download and install payloads will be posted in the near future.
Click the Go for it! button from the Standard Tab to begin.
Next I got a message that asked me to disconnect then reconnect my iPod touch and click the OK button.
You will then notice a status bar appear. Unfortunately, mine only displayed until around 13% when the iPod rebooted into recovery mode and then it disappeared. No worries though, the jailbreak procedure continued and finished successfully. I was not notified that it did by the software. Just watch your iPod until it comes to rest at the \"Slide to unlock\" screen.