Just follow the steps below and soon you will be having an updated iPod Touch with firmware 3.0 absolutely for free.

1. Download the latest iTunes from here.
2. Connect your iPod Touch 1G or 2G to PC/Mac with iTunes.
3. Click on Restore while holding Shift (for PC) and Option (for Mac).
4. Browse to the Firmware 3.0 for your device and select it.

Sit back and enjoy while iTunes does the rest! There you go, did it without even paying a penny!

Download links for the Firmware 3.0 are provided below:

iPod Touch 1G

http://hotfile.com/dl/7502030/aeb4c04/iPod1G_3.0_Final_Restore.part1.rar.html

http://hotfile.com/dl/7502069/ee390c5/iPod1G_3.0_Final_Restore.part2.rar.html

http://hotfile.com/dl/7502095/326da6e/iPod1G_3.0_Final_Restore.part3.rar.html

iPod Touch 2G

http://hotfile.com/dl/7502116/dd5dda8/iPod2G_3.0_Final_Restore.part1.rar.html

http://hotfile.com/dl/7502144/8300231/iPod2G_3.0_Final_Restore.part2.rar.html

http://hotfile.com/dl/7502161/f80f346/iPod2G_3.0_Final_Restore.part3.rar.html

Use HJSplit (for PC) and Split&Concact (for Mac) to join the parts into one file. Once you download the firmware locally on your PC or Mac, follow the steps above to update iPod Touch to Firmware 3.0.