Nov 23 - Official Dev-Team just posted a new Blog Update #1

Dev-Team Blog

http://blog.iphone-dev.org/post/1652053923

Update #1.
In the meantime, please make sure you have your 4.1 SHSH blobs for all your devices.  These will be important even for firmware beyond 4.1 (using both comex’s method and our alternative, depending on how each of them turn out.)
ultrasn0w unlock:  After redsn0w is officially released with the new Cydia and kernel patches, we’ll be able to assess the unlock situation.  It’s already looking very promising though, so expect the unlock for the 3G and 3GS to be coming this week.  The i4 unlock is taking more effort though, and no further concrete info is available about that yet.

Feel free to ask questions in our comments section below, where we’ve got some awesome new additional moderators — sherif_hashim, dhlizard, and Frank55!
Update #1:  redsn0w version 0.9.6b4 is now available for your 4.2.1 jailbreaking pleasure.  Please read all the above to understand what this jailbreak currently entails.
Mirrors - 
Mac

• http://www.iphone-storage.de/redsn0w_mac_0.9.6b4.zip
• http://cdn.nspwn.com/redsn0w_mac_0.9.6b4.zip
• http://tgq.nl/redsn0w_mac_0.9.6b4.zip

Windows

• http://cdn.nspwn.com/redsn0w_win_0.9.6b4.zip
• http://tgq.nl/redsn0w_win_0.9.6b4.zip
• http://bubele.eu/redsn0w_win_0.9.6b4.zip
• http://kwek.no-ip.org/redsn0w_win_0.9.6b4.zip

It’s very important that you get the file permissions and ownerships right in your custom redsn0w bundles. To give you a practical example of such a bundle, here’s one that includes OpenSSH, OpenSSL, and the basic apt installer programs:

SSH bundle v2 (update: v2 has fixed permissions..you can just drop this one right in even if you installed the first version)


HOW TO: Jailbreak iOS 4.2.1 iPhone 4, 3gs, 3g, iPad, iPodTouch with Redsn0w 0.9.6b4


Few moment ago we broke the news about the release of redsn0w 0.9.6b4 to jailbreak iOS 4.2.1 on iPhone 4, 3GS, 3G, iPod touch 4G, 3G and iPad with working Cydia and MobileSubstrate, as we told you earlier that redsn0w 0.9.6b4  is based on GeoHot’s limera1n bootrom exploit.
 

The bad new is that right now, the redsn0w 0.9.6b4 is a tethered or semi-tethered jailbreak for some devices (i.e. you will lose your jailbreak every time you reboot your iDevice, so you have to follow the following steps every reboot to have a jailbroken device )


Untethered Devices:

• iPhone 3GS (old bootrom)
• iPhone 3
• iPod touch 2G (Non-MC Model)

Tethered Devices:

• iPhone 3GS (new bootrom)
• iPhone 4
• iPad
• iPod touch 2G (MC Model)
• iPod touch 3G
• iPod touch 4G

NOTE: Those of you who rely on a carrier unlock stay away from Redsn0w and iOS 4.2.1.


GUIDE:


STEP 1: Download redsn0w 0.9.6b4,  iOS 4.2.1 for your device(download links at the end).


STEP 2: Update to 4.2.1 firmware using the IPSW file you just downloaded via iTunes 10.1.


STEP 3: Launch Redsn0w 0.9.6b4,  and browse for iOS 4.2.1 firmware final version 

STEP 4: Select "Install Cydia" and click on "Next"

STEP 5: Now make sure your device is both OFF and PLUGGED IN to the computer before you click “Next”.

STEP 6: At this stage you will need to put your iPhone in DFU mode by holding “Power” button and then while holding the “Power” button, you will now have to hold “Home” button too. Now after few seconds release “Power” button but keep holding “Home” button until installation begins.

STEP 7: You will Get a Jailbroken Device on the latest iOS 4.2.1  as soon as the process ends.


STEP 8: This step is only for these devices iPhone 4, 3GS (New Bootrom), iPod touch 4G,  3G, 2G, iPad. While this is tethered jailbreak and whenever you want to do anything related to jailbreak like SSH your device, or running Cydia, you must first run your device in the so called “jailbroken state” on every reboot by using “Just boot tethered right now” option.


Download iOS 4.2.1 (Final version) for your device version.
Download Redsn0w 0.9.6b4 for Windows and Mac
Download iTunes 10.1 for Windows or Mac