I had the same problem. If you have another computer, try connecting it to that before you Restore the iPhone. With me, I would connect it to my MBP and it would work, but if I reconnected it...nothing...iTunes just sat there. Then I tried using another MB I had and I was able to connect/reconnect to my hearts desire. I then tried another iPhone (my wife's) with my MBP and could only get it to connect once. I confirmed that it was the MBP or iTunes. I downloaded and reinstalled 10.4.10, since this was supposed to fix some USB issues. Then I downloaded iTunes 7.3 again, still no luck. So I deleted iTunes, (NOT the library, just the application)...trashed the preference files, downloaded iTunes 7.3 AGAIN and that time it worked just fine.
I would try to confirm that it is in fact your computer, but then try deleting and reinstalling iTunes.