Was the iPhone connected at the time? This may actually be your problem if so -- iTunesHelper passes messages to the OS about connection/disconnection of iPods/iPads/etc. If that's not functional, your ability to restore MAY be impacted. I know that iTunesHelper is what kicks iTunes open with the iPod is connected, and it does provide connection and disconnection event status to iTunes. It may be unrelated, but you can try doing a complete uninstall and re-install of iTunes (your library will survive it so long as you don't tell iTunes to delete it).