First things first, iPhone Unlock Users do not upgrade via iTunes to 3.1.2; this will kill the baseband and you will not be able to unlock.  You can use the dev teams pwnagetool.

Jailbreak: Download/Execute BlackRa1n, click the logo of your OS to download. May want to install Cydia via BlackRa1n app.

Unlock: Install Sn0w via blackra1n app.

Tether: Unlock device, go to http://m.peacefulinsanity.com/Tether.mobileconfig on iphone and tap install.

If Issues with WiFi, GPS, or YouTube come up after unlocking with Blacksn0w. Go to Settings > General > Reset> and hit “Reset Network Settings”. Once that’s complete, do a hard power cycle by holding the sleep/home button for a few seconds and then sliding the on-screen power toggle.

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