I unlocked the iPhone with the first free dev team procedure. It was a lot of manual stuff, and it resulted in a corrupted seczone. Obviously things are a lot cleaner now, but it leaves early adopters like me in the dust.

In the interest of allowing others to learn from my research/trials, I'm posting what I went through (so if you see a similar problem you're having partway through, this might be useful) to finally get to a pwned, 100% functional, 2.0.2 iPhone.

You can probably eliminate or condense a lot of these steps.

(Note, started using iTunes 7.5. You could/should probably start with iTunes, but I can't verify that.)

1. Phone was working, at 1.0.2 plus corrupted seczone old-unlock-hack. Because of this, installer wouldn't work right.
Tried manual installs / reinstalls of installer, but nothing worked. I even tried SSHing in and manually running virginizer
scripts. Odd things happened; chmod didn't function correctly. The scripts wouldn't work; even if executed individually.
I concluded I needed to restore to 1.0.2 and start over installing installer on a fresh iphone.

2. This appeared to work. I tried to use iliberty to free my fresh iphone, and it failed. I tried to use winpwn,
and it also failed. At this point I noticed that my phone wasn't booting correctly any more. It was getting the
"BSD root: md0, major2, minor0" error. None of George Zhu's proposed fixes via iliberty, restore, nor DFU restore

3. I found a post that said to start at step 12 (actually , 11) of this post:
http://www.hackint0sh.org/forum/showthread.php?t=42046 and after DFU installing firmware 1.1.1, the phone seems to
boot correctly again. I then DFU down to 1.0.2.

4. Attempting to use iLiberty to jailbreak, activate, and cydia the phone causes the purple usb cable --> itunes logo screen and
subsequent boots have the "BSD root: md0, major 2, minor 0" error. This is repaired by DFU restoring to 1.1.1. (SIM card being
present doesn't matter; I checked)

5. This looks promising. I DFU restored to 1.0.2. http://hackint0sh.org/forum/showthread.php?t=10858
(This didn't actually go anywhere)

6. AppTappInstaller stopped in iPhoneComm.exe Stage 2, (4) Booting iPhone in recovery mode.
(I don't think this helped)

7. So I download iDemocracy: http://www.drakenza.com/Were_Done_Here.html and activate, then jailbreak.
I tried to "refurbish", then use iTunes to restore to 1.1.1 (yes, phone was in DFU mode) but that caused an
itunes "2003" error.

8. Power off the iPhone; restart in DFU mode. Do the same operation: restore 1.1.1. Should work this time.

9. Trying winpwn 2.5beta, I get to the "preparing pwnage DFU restore information", but I always get "Failed to pwn
your device." I never get a countdown, and even trying to put the iphone in DFU mode and then clicking "go"
doesn't seem to work.

10. Found a page saying that winpwn requires the iphone be at 1.1.4. Why do I have to find this out via anecdote?
DFU, restore to 1.1.4.

11. Winpwn won't correctly do it. So I found that the .ipsw image is in "My Documents". Copy to desktop, then try to DFU
restore via iTunes. Doesn't work. Found an anecdote in the older winpwn guide that iTunes 7.7 is required, at minimum.
Installed itunes 7.7. Retried restore, got 1601 error from itunes.

12. Rebooted into DFU again, tried again, 1602 error from itunes.

13. Tried using expert mode on winpwn 2.5beta. Apparently easy mode doesn't actually work; it creates the
restore image, but it never goes into the countdown code to pwn the phone. I upped the root partition to 700mb per
some comments on the winpwn page, and it worked like a charm.

14. Installed iTunes 8.01. Reports are on the web that it works fine.

15. EDGE isn't configured. I find a post that references an apple tool for corporate iphone config:
Install that tool and follow the directions. You may find your APN by looking here:
I emailed the file to myself after connecting the iPhone to my local wifi.

16. Cydia only half-works, popping up a message that says "sub-process bzip2 returned...". This is solved by
allowing Cydia to update all of its source sets (just click "changes" on the bottom and then "upgrade (5)"
in the top right).