Ok, this just came out and I wanted to put it up for people. This is very simple and easy to do, you do need to update to the new 3.0 firmware, and there is a way that the iTouch users can do this for free (links mentioned in video are below) instead of paying $10 for it in iTunes.
You’re going to need the latest Red Snow (also below). This is done on a Windows box, but can also be done just as easily on a Mac using basically the same procedure. Note: there should be
|a jailbreak for the iPhone 3GS soon, so keep checking back with us. Don’t forget to keep it plugged in via USB when you turn it off during the procedure, and make sure it’s completely off before clicking ‘Next’. Also, yes you will still be able to sync all your apps (cracked or otherwise).|
Just to give credit where it’s due, and if you wish to make a donation to the gentleman in the video, here’s his site: CrackMyApple.com
Here’s the new Red Snow 0.7.2 for Windows (zip file) that you need
Here’s the new Red Snow 0.7.2 for Mac OSX (zip file)
If you’re unlocking the 1st generation iPhone, then you will also need these Bootloader files