I will not profess to be an apple genius however i have had similar issues to yourself and i have just managed to get my phone working. I also removed my phone from the "find my iphone" app on the cloud website. But it still kept saying it won't be able to restore without turning it off.
You will need to put your phone in recovery mode. From your current position on "slide to upgrade" this is what I did:
*Hopefully have everything backed up prior to performing a restore
*Reset my phone (holding home and power button).
*You will then arrive at square one where you need to input you pin
*Then turn your phone off ('slide to power off')
*Plug your usb cable into your pc/laptop (not the phone yet though)
*With your phone being switched off plug the usb in **while holding the home button**
*This should put your phone into recovery where the icon requests you plug it into itunes
*Then click restore on itunes
*Then set the phone up as a new phone
I did this yesterday after being down since Fri 17th. When i tried to restore a backup from my icloud it ended up going back to "slide to upgrade" screen.
I haven't managed to find a way to restore my backup yet. But at least I can use my phone as normal now and luckily I had backed my pictures and contacts externally.
I am sure there is probably a better solution but I have noticed that a lot of people are complaining about their icloud back-up going missing so maybe its a temporary problem.. Whos knows, either way apple have caused a MASSIVE inconvenience, haven't apologised and certainly won't provide anything which will compensate for lost time / money!!
Good luck