Following PF's cool guide to downgrade to 1.1.1 and JB, on Page 2, he writes phone should be jailbroken, activated and 1.1.1

Somehow it did not activate but jailbroke. Also, during page 3 and restore (upgrade 1.1.2 jailbroken) I got an error 1065 in iTunes.

I was soooooo close, I could taste it. Any help or comment?