Cannot activate my i phone 3gs

I bought an I Phone 3 GS from a friend and had it unlocked for my tesco PAYG SIM, I do not know about phones but the guy who unlocked it stated do not update, I didn't know what that meant. Anyway all was fine until I wanted to update my software, basically I couldn't, I have been told my i phone was more than likely jail breaked!!!! Dont know what this is but spoke to 02 and paid 15 pounds to have my phone officially unlocked, then told to restore my i pbhone which I have and now I cannot activate it, it states COULD NOT ACTIVATE IPHONE I am now at a loss what to do.