It's a mode you must place your iPod in.
DFU = Device Firmware Upgrade.
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Yeah it's really slow/doesn't work half the time. Appulo.us goes slow too.
My Installous hasn't been working for days =/
Because the site was took down by tapulous and apple
EDIT: Its back up - only just been brought back a few hours ago i assume
Its back up for me, but i can't download anything.
i think its down again, stopped loading properly for me
I've just done mine using the tool. Failed first time with error 1604 when I tried to install the custom firmware, but this time it is fine and I have seen the Cydia and Installer icons. Just restoring my backup now, then play time!