UPDATE: A Kindle Touch can now be debricked in cases like mine by using only the USB Drive, even if it is only visible to the host PC for a few seconds during the reboot cycle like mine was. It has been reported to work if your Kindle is stuck at the startup screen with no progress bar, and it also works if you kindle is stuck at the dreaded "Repair Needed" screen (like mine was). No serial port connection is required, so no need to open up the Kindle back cover.
EDIT: This schematic is used for Kindle Touch serial recovery (debricking) as described in this thread:
I would recommend just getting a USB to 1.8v TTL serial adapter, but for those who requested a schematic when I described this circuit in various posts and multiple times on the IRC channel, here is the level shifter circuit that I used with my 3.3v USB serial adapter to recover my bricked Kindle Touch:
You can harvest resistors and diodes from discarded circuit boards. To use salvaged surface mount components, I recommend soldering small wires to them first. You can harvest small wire from motors or speakers. You can also peel small wires from old computer ribbon cables. I peeled a strip of 3-wires from an old IDE cable, which soldered nicely to my kindle after stripping and solder-tinning both ends of the wires. EDIT: You can substitute a common red LED in place of the two diodes in the kindle RxD level shifter circuit. A red LED has 2.2v across it while conducting current, which although a bit higher than specified input voltage, should work fine with the kindle RxD. Do not use other colors or a super bright red LED, because they have different operating voltage drops. Although I did use a red LED in a level shifter circuit for a cellphone USB adapter cable when I "debricked" my OLPC (One Laptop Per Child a/k/a XO computer), I did not test an LED in this circuit on my kindle touch.
EDIT: You can also harvest silicon diodes from the electronic ballast circuit in a Compact Flourescent Lamp (CFL, the "twisty" kind). Even discarded CFLs may have useful parts inside.
Enjoy, but please be careful to not damage anything with it. If you use this, you agree that you will use it at your own risk. And please be careful to not poke your eye out with that hot soldering iron!