iPhone 4 (GSM) - "There is a problem with your iPhone"

I don't exactly know if this is two separate issues, or a combined one. Just to let you know.. (This iPhone has never been Jailbroken)

My carrier is Vodafone and on Sunday morning, signal strength bars on my iPhone 4 kept dropping, increasing, and dropping to a point where it stayed at

"No Service" and remained that way. I could not make calls or text and even received a pop-up notification instructing me to restore and backup my iPhone via iTunes to address the issue.

After doing so, re-downloading the latest firmware 5.1 and extracting and verifying, it came to a point on iTunes where it could not at all, activate my iPhone. A message popped up on iTunes saying - "There is a problem with your iPhone"; We're sorry, the iPhone you connected may be damaged and cannot be activated for service. We recommend that you visit your nearest Apple Store for more information.

My iPhone was working completely fine (Besides the "No Service"), up until I restored it, and this error popped up.

Yesterday, I visisted 2 Vodafone branches hoping that solutions would be met. The first branch told me its not the sim card because they slipped one of their own in my iPhone, and the "No Service" sign remained there, and directed me to visit the genius bar at Apple. The other branch asked if I had jailbroken my iPhone, I said no, so they redirected me to visit a genius bar at the nearest Apple store.

I've tried researching for solutions, yet nothing has addressed my issue.

What I did find however, could possibly be the reason why this is occuring.

- Apples verification system may be experiencing problems

- Hardware & software fault of the iPhone (hoping not - since it was working completely fine, until I restored it).

I have scheduled an appointment at the Genius bar this Thursday, and I am well over my 12 month warranty.

All solutions would be greatly appreciated 🙂