I simply plugged my iPod, opened iTunes, backed up the device (without updating; it took a few minutes) and then I pushed the “update” button and waited. The first step was to back up the device, again. The computer said that the whole updating could take an hour an half, so I went to watch TV. After a couple of hours the progress bar had moved only a few millimeters! I closed all other applications running on my iMac and tried again. After another couple of hours, the progress bar still had moved only a few millimeters! Frustrated, I turned it off, decided that I would update to iOS 4 later and went to bed.
The next day was one of my day off, so I tried again. Same result. So I started to search the forums and read the tech news sites to discover that I was not alone with this problem. After reading various suggestions, I first tried the simplest one: I removed all music, movies, tv shows and podcasts from the iPod Touch (I could resync them after updating) and tried again. After one hour (I was getting less patient) I still had only a few millimeters on the progress bar. Therefore I decided to go with a more radical solution: do a restore instead of an update. And it worked! In less than an hour, iTunes backed up the iPod's data, performed the update and resync the content. Of course, since the last sync was done without much content (remember I removed all music, movies, tv shows and podcasts), I had to reselect the “Sync Content” box (it was easy since each individual selection was still checked) and sync the device again.
Unfortunately, for me, the update to iOS 4 was a little disappointing. Without the multitasking and background pictures, the “only” improvement are folders, the unified mailbox and a few other small things. But just that is already great. But the worse is that this old device (after all it's nearly two years-old) is barely compatible with iOS 4, so it is slightly slower than before and tends to crash more often... If you have a 2nd gen iPod Touch and haven't updated it yet, well, I would not recommend doing it. iOS 4 is really for the iPod Touch 3rd gen, the iPhone 3GS & 4.
All this made me think that maybe it was time to upgrade my iPod Touch (I'm sure that's the purpose of all software updates: make you slobber over all those cool new features so you'll want to upgrade your device). After all, when I purchased the iPod Touch, I told myself that it was like a set of training wheels for the iPhone... Unfortunately, I just purchased an iPad and can't really afford an iPhone 4 (the device in itself is not that expensive, but the service subscription's cost is rather prohibitive). I can't wait for iOS 4 to be available for the iPad later this Fall (hopefully in early september) so I can experience multitasking... However, with the coming of the iPhone 4, the market will certainly be flooded with used iPhones at cheaper prices... I could consider purchasing a used iPhone 3GS (not the 3G since, like the 2nd gen iPod Touch, it won't fully run iOS 4) and use it as an iPod with phone capability (just put my SIM card in it and use it with wi-fi only, without using any data plan). I could get rid of both the old iPod Touch and the even older Motorola V360. That could certainly work.
So, if there's anyone out there that just purchased an iPhone 4 and want to get rid of his/her iPhone 3GS for a reasonable price, don't hesitate to contact me...