I just updated my iPhone 4 from ios 4 to ios 7 and it looked as if everything was going fine. I saw things backedup; I saw firmware and software updated, and I saw things restored from backup. When the update was finished, I got the "swipe to set up" screen. It wanted to know what WiFi network I wanted to use, and it did not remember the password for that network. After reentering the password, it asked me to set up my Locations preferences. Then it asked me to do one of the following:
set up as new iPhone
restore from the cloud
restore from iTunes
Since I had backed up to iTunes prior to updating, I chose option 3. Although my iPhone was connected to iTunes, it asked me to connect to iTunes. I ejected the phone from iTunes (which sees the phone as it always did), and unplugged/replugged it. It said connected to iTunes for a while, and then went back to saying Connect to iTunes.
I cannot get past this point.
My worry is that the backup performed in ios 4 is not good enough for ios 7 and if I set up as a new phone and restore from my backup it will go back into the same loop.
I would really like to get my phone working soon.