iOS 4.3.2 installed on an iTouch 2G advice?

I upgraded my iTouch when prompted to iOS 4.3.2 without realising that the iOS 4.3.2 is not compatible with the iTouch and consequently the device has crashed. After spending several hours getting the device to respond to a restore option it will now not sync properly with my itunes and just displays "No Content"

Is this now a lost cause?

Will my iTouch 2G ever work with iOS 4.3.2?

I have read instructions about downgrading but not sure that I have all the files, etc that I need and just wondering whether I should consider replacing the device(a little frustrating since I only brought it a year ago).

Can anyone provide any thoughts?