From the Samsung instructions:
How Do I Update The Software On My AT&T SGH-i897 (Captivate) Phone To Android 2.2 (Froyo) Through Kies Mini For PC?
Kies Mini Does Not Detect The Phone:
◦Depending on the amount of data stored on the memory, this could impair Kies Mini ability to detect device if phone is set to Samsung Kies mode. It may be necessary to remove the microSD card if inserted. Should problems persist, the internal memory may need to be purged. Backup up all desired data and then goto Menu>Settings>Privacy >Factory Data Reset. Follow the onscreen instructions and after reboot, attempt to connect to Kies Mini.
◦The Media Scan process could produce a loop if connected while in progress. If this occurs, disconnect and power cycle the device. Wait until the device fully boots and the process is finished before connecting again.
◦When the handset goes into download mode instructed by Kies Mini, additional drivers need to be installed. A timeout may occur from the time the drivers install until Kies Mini can detect. Should this occur, close Kies Mini and remove the cable. Next, remove the battery cover and battery. Afterwards, insert the battery, place the cover back on, and power on the device. When the device reboots, connect the data cable and open Kies Mini.
◦Kies Mini requires an 2.0 USB port to perform an upgrade. Most PCs will have this. If your computer is running XP with no Service Packs, a Service Pack needs to be installed to provide support for EHIC (assuming your USB h/w meets USB specs). If there are problems with updating, trying plugging in the cable from the front of the PC to the rear or vice versa then attempt to update again. In addition, avoid the use of hubs and docking stations.
Connection Lost:
◦Kies Mini contains an update feature which will download the latest copy of Kies Mini. If you are experiencing problems with the connection, simply close out of Kies Mini and reopen it. At that time, it should check for updates