That happened to me to. After running jailbreak.jar the phone stayed in DFU mode and iTunes launched. What I did was eject from iTunes and quit it.

Then I ran independence and had it boot from DFU mode and that brought it out jail broke on 1.1.2.

ok folks, I am currently running 1.1.3 on a non at&t sim now. The only suggestion I have is to Open the newest Independence 1.3.2 after every firware update in iTunes, otherwise it will just hang at the recovery screen on the phone. Once inde is launched, the phone has NO problems. Independence is THE KEY. I just wish I knew this 12 hours ago.

Originally Posted by djearlybird

So today I saw the dev team finally released the 1.1.3 update/ in order to do so, I had to upgrade my 1.1.1 to 1.1.2 I followed Sassha's guide to do so....

http://www.hackint0sh.org/forum/showthread.php?t=17395

I prep'd with OktoPrep, then held option and clicked update in iTunes, everything worked good. I then opened the jailbreak.jar file, clicked jailbreak, and thats where things went wrong. When it was finished, it said that it would reboot a few times, which it never did. So all I had was an iPhone that had a picture of the connector cord and the iTunes symbol. I was able to restore it, using the 1.1.2 file. How can I get my phone working again with my non-at&t SIM, because when I turn it on all I get is to make an emergency call, and when its in iTunes it wants me to activate with AT&T. This is my 1st post here, and guys, I need all the help I can get, this is my only phone, please help. Thanks.

You did everything fine here. When you get done with oktoprep and jailbreak.jar, and you have that connect cable/iTunes screen, fire up iNdependence 1.3 beta and then shut down iTunes. Let iNdependence kick the phone out of recovery mode for you (it should do this automatically if you let it wait for a few minutes, but if nothing happens try to shut your phone down (the screen will simply blank) and then press the wake button on your phone - you just want iNdependence to sense your phone in recovery mode and then it should work it's magic.

I had this same issue today, and that's how I solved it. I think the new iTunes is interfering with the jailbreak.jar reboot process, thus leaving the phone suspended in a recovery state. Keep at it - you're close!