I have exactly the same problem that blondebabe69 posted.
Basically, I followed all the instructions given online:http://www.youtube.com/watch?v=dx7UJD9JsRo and
http://support.apple.com/kb/HT1808 and unfortunately, it does not work. I tried it countless times already, but to no avail.
The iTune messages given is not what was described or demonstrated.
It does not say "iTunes has detected an iPhone in recovery mode".
Instead it prompted "to allow this computer to sync info from your phone.. ". There is only a "Continue" or "Cancel" option. Pressing Cancel does not work, because it just make iTune appeared like no phone / device detected.
So when you press "Continue" another messge pops up and says "to allow access, please repond on your iPhone". How do you response via the iPhone when it is disabled, and nothing I press on the iPhone meets this 'response' required.
My only next option appear to visit the repair center directly... as there is no solution given that seems to work. 😟