I have a 1st gen iPhone, running v2 of the firmware. It is jailbroken but not unlocked.
I have no issues. I notice your showing unlocked on your signature. Are you using it with a provider that sells iPhones? If not, that may be why. If so, I am not sure. However I thought I would post my specs and the fact I can get into it, without issue to hopefully help you out.
What firmware are you running? what provider are you on? Those 2 questions would seem to be important for usage I would think.