you have really slow internet i take it? less then 1MB/S probably. it'll take a while to download it, but you could try downloading it manually and updating via a .ipsw file. it is quite simple:
1. dowload a .ipsw file of the firmware you wish to update to (you can find these at http://www.felixbruns.de/iPod/firmware/
make sure it is the correct version for your ipod).... save it to your desktop for safekeeping. also, make sure you have the latest version of itunes
2. wait for it to download: watch a movie, get caught up on TV, do homework, go to sleep, go outside and play, go to work, etc.
3. once download completes, open itunes with your ipod plugged in. ignore the request to update. click on the icon for your ipod. hold the shift button and click on the "update" button, it should open a file dialog box. find the .ipsw file you downloaded earlier click open.
4. allow to run, this should take about 45 minutes, take this time to do other activities such as surfing fail blog
or learn something new on instructables
, or hell, help someone out on fixya
5. return to your ipod after the wait to see if you had success. if you did, GREAT, continue to step 6. if not, do step 3-5 again, if that doesn't work.... you may need to try a different .ipsw file, return to step 1.
6. you now have an updated ipod touch, now you can enjoy the new 3.0 apps and such. might i suggest Eliminate
or Topple 2