Q: My iPod touch won't let me restore it now that it is locked out..??!

My 6 yr old locked the ipod and it says ipod disabled, conect to itunes. Everytime i hit restore it says that the ipod software update server could not be contacted and i am connected to the internet on my computer. I did, however, notice that there is something that comes up when i first plug in the ipod that says its unable to use the ipod beause it requires a version of itunes 10.6.3 or later??... help please!!