I have an Pwnage unlocked 3G on 3.0 and have been considering updating to 3.1.2. I've run into a couple of apps that require 3.1.2 to run, and my iPhone seems to be considerably slower than it used to be.

- What is the best method to use for the update, jailbreak, and unlock?

- Any tutorials?

- Can I still have tethering?

- Should I backup and restore the backup in iTunes, or treat the phone as new?

Thanks in advance, everyone!

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iPhone 3G, 3.0 firmware, jailbroken and unlocked

use pwnagetool to create custom firmware 3.1.2 to restore to your phone.
custom firmware will keep you baseband as is and you continue to use ultrasn0w as unlock. IHMO, this is my preferred choice.

Answer to all of your questions is yes.
Search the forum here or go to iclarified.com for tutorials

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1. I would agree with dtube
2. Restore to 3.1.2 using pwnagetool via iClarified iClarified - iPhone - How to Jailbreak Your iPhone 3G on OS 3.1.2 Using PwnageTool (Mac)
3. Of course, there is a guide on how to do this on iClarified iClarified - iPhone - How to Enable Tethering on Your 3.1.2 iPhone 3G, 3GS search around here also, there is some good info related to this on the forum.
4. I would recommend you treat the iPhone as new after the upgrade. You may have some problems if you restore your iPhone from backup. This is a personal choice really, but I always experience better battery life by setting up an iPhone as new

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iPhone 3GS 32GB factory unlocked (3.1; Pwnagetool, Cydia, OpenSSH)
iPhone 8GB (3.1.2; Pwnagetool, Cydia, OpenSSH)

In case of 3.1.2 OTB, which one should I choose? Pwnage Tool or Blackra1n? I know I cannot board the pwnage train but read somewhere that Custom ipsw's don't have the normal wifi, push issues reported by Blackra1n?
So, will pwnage tool be a better bet or should I be the *Guinea pig*?

Pwnagetool is always the better bet, it provides a more full featured jailbreak and also ensures that you develop the correct habits and never restore to an original Apple OS which will remove (perhaps permanently) your ability to jailbreak (on a 3GS or the latest iPod touches) and to unlock (on all iPhones besides the 2G)

Unless you have the latest bootrom on a 3GS or iPod Touch, you can still board the pwnagetrain.

If you have a 3GS with 3.1.2 ootb (but the old bootrom), you do have to use blackra1n as an intermediate step to get onto the pwnagetrain if you are not performing your jailbreak on a mac. In other words jailbreak with blackra1n and then jailbreak again with custom ipsw. This gives you a cleaner jailbreak.

You can find out what bootrom you have via the procedure outlined in this post http://www.hackint0sh.org/f159/92136-3.htm#post468379

iBoot version 359.3.2 is new bootrom that can only be jailbroken tethered.

If you have a Mac, you can jailbreak all devices (except iPod Touch 3rd gen) directly with PwnageTool 3.1.4 even if they are running OS 3.1.2

The things that pwnagetool does better jailbreak wise than blackra1n are:

• Hactivation: YouTube and Location services work
• AFC2: This is enabled as part of the jailbreak, meaning you can use tools like iPhoneBrowser, PhoneView and diskaid to get access to your whole iPhone not just the Media partition.
• Control of baseband update options.
• Safe upgrade to new OS versions, without losing jailbreak.
• Custom Boot logos

Plus some features that generally apply to more power users.

If the iPhone can officially activate with Apple then both blackra1n and pwnagetool give a jailbreak that includes working push notifications. However if hacktivation is required (you don't have access to an official carrier sim or you are not factory unlocked), you need to manually fix push notifications afterwards using this guide http://www.hackint0sh.org/f137/96714.htm

The wifi issues are not related to blackra1n. They are either: incorrect installation of blacksn0w (installing it twice for example) an interaction between blacksn0w and apple's software or an apple bug or a real hardware problem. Most likely all these separate issues are being reported as the same problem.

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iPhone 3GS 32GB factory unlocked (3.1; Pwnagetool, Cydia, OpenSSH)
iPhone 8GB (3.1.2; Pwnagetool, Cydia, OpenSSH)

Thanks for the super clear reply. Unfortunately, I have the new iBoot. Hence, only tethered JB for me. So, I cannot use Pwnage tool right?

So, for the iBoot 359.3.2, Can Pwnage tool JB the phone but cannot help on rebooting (Blackra1n does this) or Pwnage tool cannot JB the phone at all?

Pwnagetool cannot yet successfully jailbreak the new bootrom.

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iPhone 3GS 32GB factory unlocked (3.1; Pwnagetool, Cydia, OpenSSH)
iPhone 8GB (3.1.2; Pwnagetool, Cydia, OpenSSH)

Thanks again Olethros. Will look closer at my iBoot as you suggested.

Probably, OT and off section as well, But if I have to JB and unlock a new 3gs ootb legit activated, what are the things I need to take care apart from JB and unlock? Like backing up ECID and ECSH on "on file" or Firmware umbrella, fixing push notifications (saving the bin files ).

Are there more things to do?

Your list looks fine.

As long as you can legitimately activate you have no real need to save the push certificates, however if you plan on cancelling your legitimate plan or moving away from the friend with the legit SIM card you should back up your certificates.

I would recommend getting ECID SHSH on file with Cydia and also backing up locally with firmware umbrella just for security.

__________________
Please read the stickies and search the forum before posting!
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iPhone 3GS 32GB factory unlocked (3.1; Pwnagetool, Cydia, OpenSSH)
iPhone 8GB (3.1.2; Pwnagetool, Cydia, OpenSSH)

Thanks Olethros
LoL..

On a serious note, my issue is I am not in US (where my friend bought it for me).I have the original SIM though. I am thinking legit SIM is required for authentication and actual at&t signal isn't required. So, theoretically it should work. Am i right?

Also, is there an issue if I do the activation many times (after restores) as it asks for SSN and other personal details and I don't want to lose my friend
Does that fact that I am not in US make activation difficult (non US IP address)?