Well I went ahead and followed the steps which include opening up "C:\Program Files (x86)\QuickFreedom\Files\vista\1) ADD HARDWARE WIZARD" (This folder may be different for you, but it should be pretty easy to find.) and in the README!!!!.txt, I followed step one and step two. Step three has me open the start menu and type "hdwwiz.cpl" which brings me to Device Manager. That seemed very wrong, so I tried again. I searched video after video on youtube, website after website on Google, with no avail. I asked quite a few people too, everyone that had jailbroken their iPod Touch had done it with Windows Vista. In this video, 'QuickTether' says that if you open Control Panel and just search for add hardware, you will also find a link that says "Install drivers for older devices with Add Hardware wizard," On Windows 7, this has been removed.
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If you happen to be attempting to jailbreak an iPod Touch 2G with firmware 2.2.1 and you are using Windows 7 64-bit, well it pains me to say, but the solution was right under my nose the entire time. Instead of typing "hdwwiz.cpl" just type "hdwwiz" and you'll come up with "hdwwiz.exe" If you watch this video, then everything else will be the same and it should work for you pretty quickly. I wasn't able to get my USB devices to work after the first start up, so as soon as you get to the normal bootloader, quickly press the up or down arrow key to deselect Ready Driver Plus and select Windows 7 then press F8. After pressing F8, select something like "Disable Driver Signature Checking" (I don't remember exactly what it is now) and everything should work normally.. At least it did for me.