Sn0wbreeze has just been updated to version 2.0.1 to fix iTunes Error 37 which has been problematic for some iPhone 3G users when restoring to the custom firmware file. According to Deon Yeang on Redmond Pie’s facebook page, the error occurs when you are in midway of restoring to the custom cooked firmware using iTunes.
The new Sn0wbreeze 2.0.1 apparently fixes this problem. You can download it from the link given below, and then follow the exact same instruction as posted earlier for iPhone 3G / 3GS (tutorial link), and iPod touch 3G / 2G (tutorial link).
Feel free to ask me any question here should you run into any problem during the jailbreak process.
Download iTunes 10 for Windows
Download iOS 4.1 for iPhone 3GS, iPhone 3G and iPod touch 2G/3G
Download iOS 3.1.3 for iPhone 2G, iPod touch 1G
Download .NET Framework 3.5 (required to run Sn0wbreeze)
Download Sn0wbreeze 2.0.1 (Windows Only)