Redsn0w 0.9.6b5 jailbreaks i OS 4.2.1 but also provides the added ability to install baseband firmware that can be unlocked for the i Phone 3GS and i Phone 3G.
For other i OS devices, redsn0w 0.9.6b5 will simply jailbreak the device but some models will be a tethered jailbreak.
This is a two stage process, first you jailbreak your i Phone with redsn0w and update the baseband, and then you unlock the i Phone 3GS or i Phone 3G with ultrasn0w 1.2 unlock.
If you followed the guide correctly, you will now have an unlocked i Phone and you will be able to use it on other carriers.
Devices that can not be unlocked will simply be jailbroken, some of which may be tethered.
You can read the difference between tethered jailbreak vs untethered jailbreak, but essentially a tethered jailbreak requires you to connect your i Phone to boot the jailbroken device and use things like Cydia and Safari.
For Windows 7 and Vista users, be sure to run redsn0w as Administrator in “Windows XP Compatability Mode” if you encounter any errors, you do this by right-clicking on the redsn0w application and selecting XP Compatability.
Update: redsn0w 0.9.6b6 has been released and all those who wish to unlock i Phone 3GS or i Phone 3G should use that version instead since it will provide for better battery life.Stuck in recovery mode loop after restoring i OS 4.3.3 custom IPSW on your i Phone 4 or i Phone 3GS?No worries, as the Tiny Umbrella (Fix Recovery) for i OS 4.3 is still valid for those who are stuck in i OS 4.3.3 recovery mode loop.For those who don't know, Apple introduced a new security check in i OS 4.2.x and i OS 4.3.x which puts all those i Phone into recovery loop who try to preserve their old baseband using Tiny Umbrella or by changing HOSTS file.Note: Using Rec Boot or Tiny Umbrella (Exit Recovery) to kick your i Phone out of recovery mode loop will be of no use as these tools are only valid for i Phones running i OS 3.1.x and i OS 4.0.x/4.1.Thanks to Notcom who released this special version of Tiny Umbrella called Fix Recovery which can actually kick all i Phone 4/3GS users out of i OS 4.2.x and i OS 4.3.x recovery mode loop using Green Pois0n exploit.