Restoring 1.1.4 to default throut itunes

[myemaildw]

My iphone is acting up. The touch screen an't working after installing sunburst app. I want to reinstall 1.1.4 to default factory settings through iTunes. But will it upgrade my iPhone to 2.0? There is not jailbrake for 2.0 yet, so I don't want to do that.

Second quesiton. If I restore my iPhone to 1.1.4 and jailbrake it with Ziphone will my simcard work or will I have to unlock my iphone again?
Thank you

[abijnk]

The Pwnage tool for iPhone/iPod Touch was released yesterday, so it doesn't matter what you do either way.