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Attempt This at Your Own Risk!
Its Not My Fault if You do something Incorrect and you CAN'T use your iphone Anymore. This will not update your baseband if done CORRECTLY!
But I'll do my Damnedest to Help you, as Long as you ain't Flaming! :mudkip:
Now that Thats out of the way Tutorial Time
Compatibility:
Sn0wBreeze 2.2:
iPhone 3G - YES
iPhone 3GS - YES
iPhone 4 - YES
iPhone 4 Verizon - YES
iPod Touch 2G (MC and Non-MC) - YES
iPod Touch 3G - YES
iPod touch 4G - YES
iPad - YES
Apple TV 2G - YES
PwnageTool 4.2:
iPhone 3G - YES
iPhone 3GS - YES
iPhone 4 - YES
iPhone 4 Verizon - YES
iPod Touch 2G (MC and Non-MC) - NO
iPod Touch 3G - YES
iPod touch 4G - YES
iPad - YES
Apple TV 2G - YES
Text Tutorial
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1) Windows - Download Sn0wBreeze 2.2.1 You must login or register to view this content.
Mac - Download PwnageTool 4.2
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2) Windows/Mac - Download iOS 4.2.1 for Your iPhone You must login or register to view this content. Reminder Rename the .Zip file to an .IPSW file
3) Optional Windows/Mac - Backup your iPhones files in iTunes
4) Windows - Start Sn0wbreeze Browse for the iOS 4.2.1
Mac - Start PwnageTool Click on Expert Mode.. Pick Iphone.. Browse for the iOS 4.2.1
5) Windows - Click on Expert Mode.. Then General.. Make Sure "Activate the Phone" is checked IF Your NOT on AT&T ( Which everyone Following this Tutorial shouldn't Be on AT&T)! Choose The Rest of The Stuff to your liking.. Note If the "Root Partition" Is Blank I suggest Making it.. 931
Mac - Pick General.. Make Sure "Activate the Phone' is checked IF Your NOT on AT&T ( Which everyone Following this Tutorial shouldn't Be on AT&T)! Only iPhone 3g Users can choose to enable Homescreen Wallpapers, Backgrounding, and Battery %.. Other iPhone users already have this setting Set.. Don't Mess With The "Root Partition Size" Then click "Create IPSW"
6) Mac/Windows - Put Your iPhone into DFU Mode.. iTunes Should Pop up asking you to Restore..
7) Mac - Right Click on restore While holding down "Options" on your keyboard and Browse for the IPSW you made in PwnageTool AND Restore!
Windows - Right Click on Restore While holding done "Shift" on your keyboard... Browse for the IPSW you made in Sn0wBreeze... AND Restore!
Windows/Mac - After your iPhone finished its restore.... Go into Cydia.. (Should Be installed on Your Phone) Nd let Cydia do its thing.. Note: I Suggest not Letting your phone Lock during this time..
9) After Cydia is done doing its thing.. Install UltraSn0w.. REBOOT... And Enjoy your UNLOCKED iPhone on 4.2.1!!
Video Tutorial
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This Video is Not Mine.. I thought its was Alittle Easier to Follow then my Text Tutorial...
Text Tutorial Written By Cgs18... If you cant understand something feel Free to ask!
Just Make Sure You
Originally posted by another user
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Me So I Can Get Back To You Quicker! 
A Thanks is Always Welcome!