Good news for (some) iPhone users. The iPhone dev team has just released the updated version of RedSn0w 0.9.6b1 which can jailbreak iOS 4.1 on iPhone 3G & iPod Touch 2G (non-MC models only).
RedSn0w 0.9.6 beta 1 uses the same pwnage2 DFU-mode exploit that has been used earlier. Currently only Mac version is released. Windows version is under testing and will be released as soon as final testing is complete.
Important: If your iPhone 3G relies on Ultrasn0w unlock, stay away from Redsn0w as it updates your baseband to the latest version, making it impossible to unlock (for now).
Guide to Jailbreak iOS 4.1 on iPhone 3G using Redsn0w 0.9.6b1
1. Download iOS 4.1 for your version of iPhone and iPod touch [Direct Download link]
2. Update to this latest firmware using the IPSW file you just downloaded via iTunes 10.
4. Start Redsn0w 0.9.6b1 and point it to iOS 4.1 (Final Version) to proceed with the jailbreak.
5. Select “Install Cydia” and click “Next”. You can also select any other option as per your requirements.
6. A prompt will appear to put the device in DFU mode. For this, hold Home + Power buttons at the same time for exactly 10 seconds and then release the power button while continuing to press home.
7. Wait for the RedSn0w tool to jailbreak your iPhone. Once completed, the device will restart automatically and you will find it jailbroken on the latest iOS 4.1 firmware.
Note: Redsn0w 0.9.6 can also jailbreak iOS 4.2 on iPhone 3G and iPod touch 2G, but it comes with loads of bugs, so proceed at your own risk.
Disclaimer: This guide is for information and education purposes only. We cannot be held responsible for any damage done to your device. Proceed at your own risk