iPod touch Ipod touch 2g problems

I purchased an ipodtouch 2g i reset the ipod and back to factory settings...now when i go to the app store i cant download any apps because it either says its not compatible or opengl es 2.0 grahics capabilitys,,,,pls help

is there a way to install firmware higher than 4.2.1 and or does it have to be jailbroken?????