so I read the really useful threads about basebands/firmwares/bootloaders and the firmware/activation/unlock threads.
I just need to clarify what I understand (or hope I understand) is right.

Okay, here goes:
For the iPhone 3G:
Newest basebands can not be unlocked on the 4.6 bootloader (which is likely the one I will be buying). So in order to upgrade my firmware, I need a custom firmware file (this is the IPSW right?) that has had the baseband upgrade removed.

In order to install the custom firmware I need a program like.... <forgot the name - is it redsnow?>, however, this is currently only available for Macs.

So my first question:
1) Is the above info correct?
2) What's the latest method for jailbreak on a 3G iPhone with 3.1.2?
3) For unlocking + jailbreaking... there are so many programs, can someone point me in the right direction? (pwnagetool, redsn0w, ultrasn0w, blackra1n)
4) If I'm buying a used iPhone on 3.1.2 with baseband 5.11, do I need to worry about activation? (I live in Canada, phone is probably locked to Rogers but is unlocked... I'm on Bell)
5) When I plug the iPhone into my computer, iTunes will prompt me to upgrade to 3.1.3, but won't forcefully do it without my permission right? (I know this might be an obvious question, but I haven't bought the phone yet and I want to be sure)
6) Follow up of 5), is there a way to stop the notification?
7) What's the general procedure for wiping someones old data off a used iPhone.
Do I have to restore it to 3.1.2 (without upgrading baseband) using a custom IPSW and then re-jailbreak it? Is this avoidable?
8) All these problems I see with the 3Gs (tethered jailbreak, etc), it doesn't concern me if I'm getting a 3G, right?
9) Anything else that Apple might have up their sleeve that I should be wary of?

I know, TL;DR - thank you so much to anyone who clarifies this for me.

Originally Posted by Daki

so I read the really useful threads about basebands/firmwares/bootloaders and the firmware/activation/unlock threads.
I just need to clarify what I understand (or hope I understand) is right.

Okay, here goes:
For the iPhone 3G:
Newest basebands can not be unlocked on the 4.6 bootloader (which is likely the one I will be buying). So in order to upgrade my firmware, I need a custom firmware file (this is the IPSW right?) that has had the baseband upgrade removed.

In order to install the custom firmware I need a program like.... <forgot the name - is it redsnow?>, however, this is currently only available for Macs.

So my first question:
1) Is the above info correct?
2) What's the latest method for jailbreak on a 3G iPhone with 3.1.2?
3) For unlocking + jailbreaking... there are so many programs, can someone point me in the right direction? (pwnagetool, redsn0w, ultrasn0w, blackra1n)
4) If I'm buying a used iPhone on 3.1.2 with baseband 5.11, do I need to worry about activation? (I live in Canada, phone is probably locked to Rogers but is unlocked... I'm on Bell)
5) When I plug the iPhone into my computer, iTunes will prompt me to upgrade to 3.1.3, but won't forcefully do it without my permission right? (I know this might be an obvious question, but I haven't bought the phone yet and I want to be sure)
6) Follow up of 5), is there a way to stop the notification?
7) What's the general procedure for wiping someones old data off a used iPhone.
Do I have to restore it to 3.1.2 (without upgrading baseband) using a custom IPSW and then re-jailbreak it? Is this avoidable?
8) All these problems I see with the 3Gs (tethered jailbreak, etc), it doesn't concern me if I'm getting a 3G, right?
9) Anything else that Apple might have up their sleeve that I should be wary of?

You are confused about some of the technical details.

Facts
3G - can be jailbroken on any supported OS - including 3.1.3. The jailbreak targets a vulnerability at the hardware level so can't be blocked by an OS update.

Baseband 05.12.01 cannot currently be unlocked on either the 3G or the 3GS (2G iPhones have not had a baseband update since OS 2.0)

Only 3G phones from the first few months after they were initially released in 2008 can have their baseband downgraded (or reloaded to the same version) if you accidentally upgraded it. These phones can be identified as running baseband bootloader 5.8. Current 3G iPhones ship with baseband bootloader 6.4 (not 4.6 which shipped with late model 2G iPhones)

Jailbreak tools to use - for first-time jailbreak on os 3.1.2: in order pwnagetool, redsn0w, blackra1n.
Unlock: try to use blacksn0w rc2 if it works for you, otherwise use the original blacksn0w.
Always use pwnagetool if you want to load any OS higher than 3.1.2

If you are planning on using a software unlock (blacksn0w) then you need to hacktivate. The jailbreak tools handle this for you. You should use push doctor to install legitimate certificates afterwards, this gives you a near-identical experience to legitimate activation.

Of course Apple does not force you to upgrade, but it is quite easy to accidentally hit OK. Best to turn off checking for updates in iTunes so you can control when and how you upgrade.

ah okay, so I mixed a few things up: thank you!

Besides the extra features, is there any other particular reason why pwnagetools is the best?

Also, I'll look more into this hacktivating concept, it's a bit confusing - but it seems the JB takes care of it.

Anyway thanks a lot for your help. But is there anything else I should be aware of?
(Even obvious things)

Originally Posted by Daki

Besides the extra features, is there any other particular reason why pwnagetools is the best?

Pwnagetool encourages good jailbreaking habits, if you use pwnagetool to create custom IPSW you generally can't get into a situation where you lose unlock or ability to jailbreak. The only exceptions are new bootrom 3GS and 3rd generation iPod touches which currently don't work with pwnagetool at all.

Blackra1n and redsn0w both start with restoring an original apple IPSW. This always has some element of risk, for example accidentally restoring 3.1.3 to a 3GS or 3G.

Originally Posted by Daki

Also, I'll look more into this hacktivating concept, it's a bit confusing - but it seems the JB takes care of it.

Actually pwnagetool gives you the option to hacktivate or not. Blackra1n installs support for hacktivation even if you don't need it. Only redsn0w autodetects the need to hacktivate based on the SIM inserted in the iPhone during jailbreak.

Thank you, you've cleared things up for me