That's not the problem :) This is not a gift card issue.

I think you may have had a different problem. What a lot of people reporting is that they get declined even after they put the said security code into the proper field. For some reason Apple iTunes is not accepting their cards even though they are good.

It's a shame this is happening. I kept trying my Visa/Debit card for days and eventually it worked. So keep trying I guess. But Apple should really address this soon.