What root method are you using? It sounds like you're at the step of setting up the hboot drivers, in preparation to use Unrevoked. If so, when you do that step, your phone needs to be in the bootloader, and you need to select hboot usb, and make sure it changes to 'hboot usb plug'. At that point, you should show up in the Device Manager, so you can then update your hboot driver.
Edit: Here's a link with pretty clear instructions on how to use Unrevoked, and set up your hboot drivers.
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