Hey thanks for the reply!
Well I went ahead and restored and updated to 4.2.1. I was hoping to be able to jailbreak using jailbreakme3.0 but it docent support the iTouch 2G.
I went ahead and successfully jailbroke using Greenposion. I thought I messed something up at first cause it was stuck on the screen where it wanted me to plug into iTunes. I went ahead and just unplugged it then it rebooted and bingo lol.
I'm looking for some cool themes and such right now lol. I'm a total jailbreak noob and I'm really surprised I got it on the first attempt lol.
Thanks again for the reply!