Unable to update 7th Generation iPod Nano

New iPod Nano 7th Generation was just received from the iPod nano (1st generation) replacement program.

The Nano has software version 1.02, and an attempted update to 1.03 is met by this dialog:

My actions that failed.

I clicked the More Information button above and followed all the suggestions.

I have the newest iTunes 12.2.1.16.

I tried to update on two separate computers (iMac and MacBookPro), and reinstalled iTunes on the laptop.

I reset the iPod Nano twice.

I tried to restore, but the same error pops up.

I downloaded the update, and attempted to load the update by choosing the file: iPod_1.0.3_37A30172.ipsw

That's about it.