First, make sure this line is in your hosts file:
74.208.10.249 gs.apple.com
The hosts file is found at "C:\System32\drivers\etc\", and can be edited with Notepad.
Next, make sure iTunes is closed, and start TinyUmbrella. Hit the "Start TSS Server" button. Then run Redsn0w with the "Just enter pwned DFU mode right now" box checked, hold shift while clicking restore in iTunes, and select
this firmware. If the restore completes with no errors, run Redsn0w with the "Install Cydia" box checked. Once that's done, turn off the phone and run Reds0w with the "Just boot tethered right now" box checked.
If all of that doesn't work, try following
the other guide I linked to earlier:
1) Connect the phone to my computer. I connected it turned off. I will refrain from using terms like DFU because I personally don't understand those terms myself.
2) Start Tinyumbrella. It might detect the device or it might not. Hit start TSS server. Now leave tiny umbrella alone and minimized.
3) Start iReb. I selected 3Gs and it did its "searching dfu" thing and found my iphone and my iphone turned on. Leave iReb minimized now.
4) Meanwhile, iTunes might have turned on and detected the device in recovery mode or whatever and asked you to restore it right away. Don't panic, just close iTunes at this point.
5) After doing the iReb and Tinyumbrella steps, go and turn on iTunes. This step is very important. You have to make sure that iTunes is turned off while you do the Tinyumbrella and iReb steps and only turn it on after those steps are complete.
6) In iTunes, click Shift+Restore and select the custom 4.2.1 ipsw file. iTunes will detect the file and start installing the software. In my device, it finished installing and veryfying and stuff and everything went well. But, after everything was done, for some reason, my iphone just wouldn't start.
7) I started redsn0w and selected the original 4.2.1 firmware (not the custom one...the original one you can download it from anywhere). I checked on Install CYDIA and it didn't do it the first time but it worked the second time.
Keep in mind once you do all this your phone will have a tethered jailbreak. You'll need to boot it using Redsn0w every time you turn it off. It will just stay on the Apple screen otherwise.