Here's the deal. I dropped my phone in water...
The good news - the phone tries to start up
The bad news - it is stuck in recovery mode with connect itune logo.

All three battery connection is shorted(multimeter) with or without battery connected. There is no voltage between any of the wire. It is not charging.

I have scoured the web trying to find solutions to no avail.
Here's what I tried:
1. Using Itunes to recover the phone to 1.1.1. through 1.1.4, Itunes expands the firmware, "prepares the iphone" which reboots and shows the apple logo and spinning wheel, and then Itunes hangs with "waiting for Iphone" forever
2. Same as above in DFU mode including the addition of 1.0.2 - same "waiting for Iphone"
3. Tried using various functions on Ziphone, ILiberty and Ibrickr. Seems like they see teh phone but can't talk to it.
4. Replaced with brand new battery.

Since the phone can start in Recovery mode and is responding to the Itunes attempts to revive it, I have some hope left, but no idea what to do now. Seems like something in the basic software got corrupted.

Any suggestions are welcome, even opening the phone up if needed. I have a strong feeling that this can be solved via software though.