I was at my wits end as I kept getting the same message 'Device not eligible for requested build'. Even for my iTouch, which I never did anything to. I never jailbroke any of my devices. I DID install TinyUmbrella (TU) to save my blobs back in July 2011 before they were going to stop saving them, but never jailbroke my device. Apparently, TinyUmbrella updates a file which directs iTunes where to look. (see links below). After removing the '#' mark in front of the address and saving it, I restarted my Mac to be on the safe side. And Viola ! Everything worked liked normal ! I was able to update to iOS 5. YAY !
I don't know if this will solve all of your problems, but it worked for me. NOTE: Depending on if you are on Snow Leopard or on Lion will determine what command you will need to key in at Terminal to update the file. They are different. You may have to Google to find the correct one if your screen comes up blank. Good Luck !
HOW TO - Resolve iTunes Unknown Error 3194Moderation Notice: This post has been edited by a member of staff in accordance with the Forum Rules. We have our own tutorial for this. Please don't link to external blogs.