2G updated, re-jailbreak and unlock

Im trying to jailbreak (in order to unlock) my friends Iphone 2G. It was running 2.2.1 and he was happy, until he stupidly accidentally updated it. The main trouble we have is that the phone was originally bought in the USA, and is now being used in the UK, and we do not have an AT&T sim card. Ive tried to use redsn0w and pwnage tool and im not getting very far. Ive tried restoring it to 2.2.1 using restore in itunes so i can use pwnage tool, i get "error 1600". 3.0 goes on fine i can use redsn0w and it seems to work, it picks up the o2 sim card and signal but needs activating in itunes, which it wont do, saying its the wrong sim card.

Anyone got any ideas?

Where is the option in redsn0w to hacktivate? on the second screen ive got the options to install cydia, install icy and unlock.

EDIT: i dont own a mac everything is getting done under windows

ive sort it using quickpwn and going back to 2.0.2, trying to update to 3.0 now.