I have a couple of iPhones running iOS 4 that I want to do a restore on. These phones have never been jailbroken, and I'm using the .ipsw that is the exact same version that's currently on the phone:
iPhone 4 - 4.3.5 (8L1)
iPhone 3GS - 4.3.2 (8H7)
When I try to restore from the .ipsw in Windows 7, I get the error:
The iPhone "myphone" could not be restored. An unknown error occurred (3194).
This error means that I need to upgrade iTunes, but I'm running the latest version. Also, I'm able to restore my other iPhone 4 using 5.0.1 just fine.
When I try to do the same on my Mac, I get the error:
The iPhone "myphone" could not be restored. The device isn't eligible for the requested build.
When I click "More Information" I see that it's also error 3194.
I checked in WireShark, and I do get a TCP connection with apple just before the error. It's encrypted though, so I have no idea what it sends/receives, but I can confirm that there's two-way communication. I tried the restore both over my company's connection, and my 3G connection just to make sure it didn't have anything to do with the IP address I was using. Also, I verified that the phones are authorized for that iTunes installation.