Thanks for all of the replies guys
On my iPhone, Cydia says I have the SHSH for 3.1.2. So does that mean that I can do this?
ok, for the third time this thread... SHSH and editing the hosts file does not effect the process of restoring to a custom pwned FW.
All that is required to restore to a custom 4.0 FW is that you are already pwned and the phone has the old bootrom.
SHSH blobs & editing the hosts file are used to downgrade to now unsigned stock firmwares.