I'm restoring an old 3G from 4.0.2 (which is Jailbroken), to 4.1 but not jailbreaking it. How simple is this to do. Do I just update in iTunes and it will wipe the JB? I don't need it JB anymore really.
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I've never had to reformat my Mac, but with a little reading I could figure it out. My incredulousness stems from the fact that I thought you had at least done some prior research beforehand.
If you're doing a clean install for bringing into apple, don't restore from backup. If it's for yourself, make sure you have a backup. Look in preferences and pick devices. If you don't have a recent backup, right click on your phone and choose backup.
If you set up as new, then all your apps and music will be back.
But all personal data will be wiped. This includes game data, SMS history, call history and the like.
If you really need to keep ALL of that, then you will need to restore from a back up. HOwever, if the back up you restore from came from a JB iPhone (i.e. you backed up your phone when it was JB'd), there will be certain things that carry over. Log files (that you can't see) and most significantly, any changes you made with MIM.