A few hours ago I tried to download a cracked cydia app, and after it was done I was prompted to reboot springboard. I clicked it, got some relatively long message but pressed reboot anyway and it appeared to have froze on me. The loading circle was moving but it was taking forever so I just pressed the power button and home button to restart my iphone. When I turned it back on, it kept getting stuck on the apple logo. After that I tried everything, restoring in itunes, re-jailbreaking with redsn0w etc. and nothing works, the only "progress" I've made is getting it into restore mode but I can't do anything or get anywhere from here anyway.

Please help me!

It's an iphone 3g, 5.09 bl, 6.15bb, 4.2.1. os if that helps

You shouldn't be downloading cracked apps in the first place, hope that was a lesson for you. You have to provide more information, what do you mean by "can't restore"? What did you try, what were the results? Try recovery mode, then use redsn0w to enter "pwned DFU" and restore on iTunes.

It was a hell of a lesson, yeah.

Here's what I tried and the results:
Standard restore through itunes = message 1015. I tried used recboot to exit recovery mode, but I just get the apple logo and then it automatically starts up in recovery mode again.

Custom restore iPhone2,1_4.2.1_8C148a4.2.1Custom_Restore file = could not be restored because the firmware file is not compatible. No change.

Redsn0w crack = everything goes smooth, but still no change. I either get recovery mode or apple logo, depending on whether it's plugged in/out, rebooted or not (10 seconds both power and home)

I think what might be key here is that I'm on the ipad baseband since it was the only one I could have used to jailbreak my phone since I had 05.15.04 on 4.2.1 with a 5.09 bootloader. With the newer bootloader I was unable to use fuzzy to downgrade my incompatible baseband so I had to go to the ipad one. Never had any problems until I saw a youtube video that told you how to get isms from cydia and the springboard reboot prompted at the end of the download froze my phone. After I pressed the power and home buttons it hasn't been working since.

Hope that clears things up.

I just found this article which says (Restore iPhone 3GS, 3G Baseband 06.15.00 To iOS 4.1/4.2.1)

"In case you are on 4.2.1, then first restore back to iOS 4.1. This is because with 4.2.1, you cannot kick your device out of recovery when you iTunes throws up error 1015.
Assuming that you have saved your SHSH blobs for iOS 4.1, you can do this restore on your iPhone 3GS using TinyUmbrella’s ‘Start TSS Server’ or by editing the Hosts file on your Computer."

The thing is, I got this phone not even a week ago and I didn't save any SHSH blogs. I didn't even know they existed. Is what was in this article the right solution? If so was it the only one? Most importantly, am I screwed until someone releases a program that can fix this?

Here's the thing, since you have the iPad baseband you can only restore to custom firmware.
In your post you said you tried to restore to a custom firmware but that custom firmware is for the 3Gs model (iPhone2,1 = iPhone3GS ; iPhone1,2 = iPhone3G)
Try the following: use redsn0w And select pwned dfu mode (you won't be jailbreaking, this is just to help in the restore) and then restore using iTunes to the correct custom firmware.