I have been having the problem with itunes stating my current version was the newest, but I came across a way to download from the itunes store for $4.95 the current version (3.1.3) for the 1st Generation ipod touch. I have the apple support link below. Just click on the hyperlink apple included and it will take you right to the app. Enjoy!
http://support.apple.com/kb/HT2052
http://support.apple.com/kb/HT2052