iPhone random restart and cannot make or receive calls

Hi,

Almost a year ago I bought an iPhone 3GS from a friend and I have been very happy with it. Until a few weeks ago when some very frustrating problems started to show. At first the iPhone would just randomly shut down and then restart only to show a message "Activation Required" and and the image to connect to iTunes. After manually turning the device off and on it would usually work normal again. But the problem became more frequent and it took more and more turning it off and on to fix it.

The problem seemed to occur only when it was unplugged from a power source. I tried several fixes including restoring from backup, full restore, restoring from other computers (mac and pcs) none helped. I noticed the device had "No Service" before it used to shut down so I figured it had something to do with my SIM but my SIM works fine on other cellphones and smartphones (even other iPhones). I attached some scotch tape to the back of the SIM and it seemed to help at first but after a few days the problem reoccured. (When the device did boot up as normal I would sometimes get the message "iPhone cannot make or receive calls").

This weekend things just when completely to ****. No matter how much it turned it off and on it kept saying "Activation Required", restoring with iTunes resulted in "unknown error (-1)" (an error code I can't even find reference to).

I am aware that is quite a long story to read but I'm just desperate at this point. I'm pretty sure its a hardware issue (I'm thinking a damaged contact or dirt inside the device) but since I didn't buy the device from an official apple store I can't get service.

Any suggestions anyone?