As promised, Apple has released the iOS 4 for owners of the iPhone 3G, 3GS, and yet-unreleased iPhone 4. iPad owners too will get it if they have a recent iPad Touch 2G, 3G .
If your iTunes not showing the update, keep hitting update button or download from following direct download links. Make sure to download the correct version, otherwise your device will be a brick.
iPod Touch 2G
iPod Touch 3G
Once you have downloaded these click the update button while holding down the option / Alt button on your keyboard, then you will be able to select the downloaded file from your hard drive.