I hope my story will help some of you today.
I went to AT&T opened a new line with NO CONTRACT voice plan ONLY.
Went home and inserted the new SIM card into the iPhone 2G and plugged the phone into my PC with iTunes 9 installed (I downloaded from
www.oldapps.com).
Activation screen came up and I clicked "Activate" and I had to choose "Existing customer..." and enter in all my information, phone # and last four SS#. Data Plan was automatic and gave me some options for some messaging plan. Then I had to enter in iTunes information and Bam I was activated.
Called AT&T to confirm I had unlimited data and they said "YES"
However, the phone would not get out of "USB connect to iTunes" mode. I tried everything you guys suggested and it did not work. I decided to take it to the Apple store where I spoke with the LEAD GENIUS and was told that only Corporate Engineers could activate the phone. I went home and called AT&T and had them transfer me to APPLE SUPPORT (APPLE SUPPORT IS FREE IF AT&T transfers you to them). Level 1 tech could not help me, so I was transferred to a Level 2 tech.
Level 2 tech told me that Apple erased ALL Original Iphone information, so if anyone wanted to use an Original iPhone 2G, they would have to contact Apple and the tech would have to enter all information manually (IMEI, Serial # and current active sim card number). After the tech entered in all the information I provided, I was asked to restore the phone one more time and BAM! Phone was ready to be activated for use.
That is my story people I hope this will help you.