The solution is rather simple, but it does not clarify why it happened. But it is probably a bug in itunes.
To fix this, go to the device manager in your computer (right click my computer, manage , device manager). Look for the iphone under the USB devices tab. (the iphone should be connected while you do this. Delete the iphone’s driver ( click yes on the wanrning message).
Now hit check for new devices on the top bar in the device manager. The iphone’s driver will install again, and itunes should recognize it now.
If it is of any significance, this bug was noted on the latest version of itunes on windows 7 64bit
Do you have any idea why did this happened? this this work for you? please comment