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Thank you for the update. May I ask which specific problems you are experiencing with the iPhone?
When you attempt to restore the firmware with iTunes, what exactly happens? Also, have you tried restoring it on a different computer?
May I ask how old the iPhone is and if it is under any type of warranty or not?
The iPads and iPhones operate in the same way.
Have you tried restoring the data using anything besides iTunes? Please, use TinyUmbrella, which is found on the following page to restore the firmware: http://www.iphone4jailbreak.org/tinyumbrella-can-now-restore-without-itunes.html
If you are on a PC, you can find the firmware files in the following folder:
Users\<User>\AppData\Roaming\Apple Computer\iTunes\iPhone Software Updates
If you are on a Mac, you can locate the firmware in the following folder:
~/Library/iTunes/iPhone Software Updates