“Modmyiphone”:http://modmyiphone.com has figured out how to downgrade to 1.0.2 and then upgrade it. There are four steps, but the documentation is at least clear:

# “Downgrade 1.0.2 Baseband”:http://www.modmyiphone.com/wiki/index.php/Downgrade_1.0.2_baseband_OS_X_iPhone by loading a package of software called Virginize. You then use sftp to copy to your phone over wifi with a freeware utility called Cyberduck
# “Upgrade 1.0.2 to 1.1.1”:http://modmyiphone.com/wiki/index.php/Upgrading_1.0.2_iPhone_to_1.1.1 by using the latest 1.25 release of iNdependence to open up the software and then use iTunes to upgrade to 1.1.1
# “Activate and jailbreak 1.1.1”:http://modmyiphone.com/wiki/index.php/Preparing_to_mod_1.1.1_iPhone by using Independence to Activate it (so you can use your phone to make calls) and Jailbreak (so you can install applications and junk on your phone freely). Finally you install ssh, sftp and scp so you can control the phone over Wifi
# “Unlock 1.1.1”:http://modmyiphone.com/wiki/index.php/Unlocking_the_1.1.1_iPhone_anySIM so you can use a non-AT&T Sim with your phone by loading anySIM on your phone with Independence and then run anySIM

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