Upgrade currently unlocked 3G[s] iPhone (Using Black Rain) from 3.1.2 to 4.1

 
Not long ago, there was a time when the iPhone 3G[s] was very famous and people used to buy it and Jailbreak and unlock it for the use with other carriers. One of the famous tools for jailbreaking at that point in time was blackrain. Almost every one I know used the black rain on the iPhone version 3.1.2 and used the blacksnow for the unlock. 
This works great but there is one issue. Most people on the New boot rom got a tethered Jailbreak, which means they have to use blackrain every time ( http://bit.ly/grYDye ). After that a lot of untethered jailbreaks were released and they want to go there. 
I had the same experience, so I thought I would document it here, 
DISCLAMER: Please use this guide on your own risk. I am not responsible for anything that happens to your phone due to this. I have used the same procedures and it worked for me.If you have any questions, put those on the comments and I will try to answer them. 
All the software is also available from the internet. I claim no ownership of the software. I merely provide the links to the software.
This is what your phone will be now. 

• OS : 3.1.2
  
• Baseband : 5.11.07 (Any baseband that is unlocked / unlockable ) - Currently Unlocked
  
• iPhone : 3G[s] (It can be 3G as well, but then you have to do additional reading)
  
• SHSH should be saved for 4.1
  
• Currently Jailbroken & Unlocked by Black rain,  Black snow respectively

In this guide, we will need the following 

• Computer (Duh !!) - If you are reading this, you already have one.
  
• OS: Windows (For MAC, you will need to use the Pwnage tool, but this guide is not for you, there are a lot of hackintosh articles)
  
• Snow Breeze v 2.1
  
• Tiny Umbrella
  
• iREB

If you are using a work computer, make sure you have access to create files on the desktop. (Believe me a lot of companies block this to enforce a clean desktop policy) 
After the process, you will find a 4.1 version of the iOS and unlocked phone, plus the jail break will be untethered (You can reboot the phone without having to run black rain). 

Backup :

Please backup your phone in iTunes (Right click on the phone and say backup). This will backup contacts, Pictures, songs, etc .
Please note that this will not backup jailbroken applications, in order to back them up, please read the guide here (http://bit.ly/hcg7fV). I normally don’t have much of apps, so I dint have to do it. I would install them later anyway  
 

Step 1: Download the required software

• iOS
  • Please download the iOS for your phone from here - http://bit.ly/ensk7B (This is the iClarified link) Please select iPhone 3G[s] 4.1 iOS (This is  huge file, you might want to download after step 2)
• Other Tools :
  • I have zipped other tools (The versions which worked for me in a single file). I will also mention them here
    • Snow Breeze 2.1 (Windows Counterpart of Pwnage tool)
      
    • iREB RC4
      
    • Tiny Umbrella 4.30.05

You can search the internet and get them individually or If you want to download as a single pack, please use the link below 
http://bit.ly/eC7gIf – To get all the 3 files

• iTunes:
  • Assuming you have an iPhone, I can safely assume you have iTunes as well. In this I am using the latest version of iTunes

Step 2: Check if the Phone is upgradable:

Start the Tiny Umbrella and Click on Save SHSH

This will save the SHSH that are signed on your phone. Please note that Apple signs SHSH only for some time. So when you installed Cydia and clicked on make my life simple, Cydia would have saved the SHSH on its servers. Please make sure the SHSH for 4.1 is saved. (You can move to any OS for which you have the SHSH saved, but this guide is only for 4.1)
If you have the SHSH saved, you are good to go. The tiny umbrella will also save the SHSH files locally.

Now once this is done and it says that Cydia has your SHSH you can proceed. If the SHSH are not saved, then you are out of luck and the below method may not work for you.

Step 3: Create a Custom iOS

We will need to create a custom iOS, so that the baseband doesn’t get upgraded. If it does, then the phone might not be unlockable. The creation of the custom iOS will also jailbreak the system.
We will use SnowBreeze for that.
Open Snow Breeze (v 2.1) and select the IPSW file that you downloaded (iOS file) . The snow breeze version is iOS specific, so we will have to use a version 2.1 (the latest version 2.5 doesn’t work)

Browse the iPSW file
It will then point whether it is a valid IPSW or not (It will check the checksum, if your browser saved the IPSW as a zip, please rename it to ipsw, else use a different browser like safari (for windows))

Click on Simple Mode and that’s it, let the magic run. It will create a file on your desktop like this

The new IPSW is ready to be restored on your iPhone, but before that you will have to put the phone in DFU mode. Here is a tutorial to that (http://bit.ly/ePKvyx)

Step 3: Recovering your OS

Since now your phone is in DFU mode (an you have your iTunes open) Shift + Click on Restore, select the newly created custom firmware and click ok. You should be fine.
But most times, you will get an error (16xx) or some thing. If you do, you will have to use the iREB
To use iREB, put your phone in the DFU mode ( more like ly since you must already be in a DFU mode, you can just fire up the software and click on the phone model (in Our case 3G[s])

Once you do, it will use the limerain exploit and jailbreak your phone. After this, just restore the phone using iTunes (Like mentioned above)
Reminder on how to do that :
Connect your iPhone via USB cable and put it in DFU mode. To put it in DFU mode, turn the phone off. Hold power and home together for precisely 10 seconds. Release power but keep holding home until the pc beeps as a USB device is recognized. At no point will the display come on. If this doesn’t work, try to press and hold power only. Keep holding power. As soon as you see any display on the screen of any sort press and hold the home button. Hold power and home together for precisely 10 seconds. Release power but keep holding home until the pc beeps as a USB device is recognized.

Once you are done, you will be running the iOS 4.1 on your 3G[s] and you can reboot as many times without the blackrain (Make sure the Cydia is installed)
For some people they might need to re-unlock the phone. Just go to cydia,

Click on Sources

http://repo666.ultrasn0w.com is the URL . Now search for Ultrasn0w and click install

It will install the ultrasn0w and you will be unlocked for any carrier.
You may have to apply a fix for Youtube videos not working. Please read the guide here (http://bit.ly/hxuUIK) . Please restore the phone from the backup and you will have all your data back.
Hope you find this informative. Let me know how it goes in the comments. Thanks !!! and enjoy your untethered phone.