Thank you guys, I unlocked my phone easily.
It was simple than I thought.
Just used latest iTunes 10.5 to restore to 4.1 ipsw but it put me in recovery loop and I used tinyumbrella to get out of that and then used redsnow 0.9.9b7 to install cydia and install iPad baseband which jailbroke it and then installed ultrasnow via cydia and was able to run cincinnati wireless on my iphone.
Couple of follow-up questions. 1. Is this an untethered boot and did you try to upgrade to 5.0 after downgrading to 4.1?
Thanks!