Q: How can I update my 2nd gen ipod touch to 3.0 at least? Desperate for help!

You can update a 2nd generation iPod to iOS 4.2.1 by attaching it to a Mac or PC running iTunes.

From http://support.apple.com/kb/HT4623 :

1. Ensure that you're using the latest version of iTunes.
2. Connect your device to your computer using the included USB cable.
3. After iTunes opens, select your device when it appears in iTunes under Devices.
4. Click "Check for Update" in the Summary pane to check for available updates.

Are you sure yo have a 2G? 1 1G can only go to iOS 2.2 via iTunes and can go as high as 3.1.3 by:

Purchasing iOS 3.1 Software Update for iPod touch (1st generation)       

https://buy.itunes.apple.com/WebObjects/MZFinance.woa/wa/touchLegacyLandingPage

The 1G does not have volume buttons on the upper left edge.

Identifying iPod models