I downloaded iTunes 10 but now it won't update my iPod Touch software
Is there a error number associated with this error?

Did you check to see if you have an internet connection?

Did you restart your computer?

Did you wait a while and try back later? Apple could be experiencing a downtime when you tried to access their server.

Do you have a firewall on? Is the port open for iTunes?

It could be any number of things...Let me know if this helps!