The Dev Team released the iPhone 2.2.1 jailbreak. You can download the files pwnage or quickpwn (Mac) / quickpwn (Windows). At this point, only MAC OSX Quickpwn and pwnage are released. You should read the dev team blog for details and warnings on the upgrade relating to the 3g unlock. The 2g baseband has not been upgraded so you will not lose your unlock if you are unlocking a 2g iPhone. The 3g yellowsn0w 0.97 has been released also.

Additionally, the procedure is the same so if you need help head on over to the guides section and read the pwnage or quickpwn guides.

Confused about which one to use?

Pwnage – use this if you are going to unlock your 3g. It will prevent a baseband update. Use this to build a custom firmware and program it on. This will do the upgrade for you so you do not need to update in itunes.

Quickpwn – use this if you want to just upgrade in itunes then jailbreak. Do not use this if you are unlocking a 3g. Use this if you have already updated to 2.2.1.

Finally, a personal comment. Should you upgrade at all? If you are running 2.1 or 2.2, I say no. 2.2.1 is pretty much worthless. If you are running anything under 2.1 yes you should upgrade. 2.0-2.0.2 are horribly buggy and slow. 2.1 and newer solve this. If you are below 2.0, you dont even have appstore and you are obsolete. Upgrade!