See the new article below. Has anyone tried this? Apparently you can download a workaround via Cydia which reverses your spirit jailbreak so you can upgrade and jailbreak iOS4 using existing tools.
http://www.ihackintosh.com/2010/07/restore-ios-4-custom-firmware-with-iphone-3gs-jailbroken-with-spirit/
http://www.ihackintosh.com/2010/07/restore-ios-4-custom-firmware-with-iphone-3gs-jailbroken-with-spirit/