The Italian firmware update is the last update we received for our iLiads.
https://www.mobileread.com/forums/showthread.php?t=31334
You can't do a firmware update on an iLiad using a USB thumb drive - you must connect to iDS.
You can only set your clock after you've connected to iDS once. I have firmware 2.12, build 21201.
If you can make it to the Melb meetup this weekend, Nigeldb should be able to assist you with your update. It's only a 6 hour drive...