Yup yup...IPSW was saved to desktop. Importing it is not a problem at all, just thought I would share it in case it is an issue with pwnage tool an someone would want to know about it.

Once again HUGE thanx to the entire Dev Team and all that work together to provide these rightly deserved liberties of using our devices as we see fit!

Upgraded iphone 3GS to 4.3.2 using Pwnage Tool to create a custom IPSW and preserve my baseband 5.12.01
The process was pretty smooth except for the fact that pwnage tool did not recognize the factory IPSW 4.3.2 on my macbook desktop and had to use expert mode to manually load the IPSW. Is that an issue with pwnage tool or my mac? .....wondering.

3GS - 3.1.3 - 05.12.01 - NEW BOOTROM - Serial# 5K0060xxxxx
SHSH saved for 4.0, 4.0.1, 4.0.2, 4.1, 4.2.1+, 4.2b3

Will the Pwnage Tool 4.2 work to create the custom ipsw in order jailbreak/unlock this iphone?

I mainly ask due to the new bootrom/serial number of this iphone.

Thank you in advance. I appreciate everything the Dev-Team does for the jailbreak/unlock community.

MaDD thx to @stormj1 for helping me find this solution on accident...(just by trying his steps to exit this hellish recov loop):

***HOW TO GET iPHONE (3G - 4.2.1 - 6.15.00) OUT OF iTUNES RECOVERY LOOP****
(BATTERY DRAINAGE ISSUE NOT PRESENT, GPS WORKING PERFECTLY, JAILBROKEN AND UNLOCKED)

Hardware/Software requirements: (MAC users can pull relevant info from here)

-AT&T sim card (activated or not, old or new, either way n then sum, no matter)
-SHSH blobs for 4.1 fw saved (this is imperative, otherwise read no further)
-Stock 4.1 ipsw ( icommunity section of this site)
-most current Tiny Umbrella (4.21.01 as of 12/02/2010)
-redsn0w 0.9.6b5 (as of 12/02/2010)
-most current iTunes (10.1.0.56 as of 12/02/2010)
- 1 small paper clip (if you dont know what this is for, you should stop NOW!)
-AND ur iphone plugged into the pc the whole time! :)

Exiting recovery loop & jailbreaking/unlocking instructions:

*****the following steps assume your TinyUmbrella has already saved/recognized the required SHSH blob for your device*****

**start with your phone in the iTunes recovery screen****

STEP 1: Start Tiny Umbrella, wait for it to recognize your device, select your device in the upper left hand corner
STEP 2: Click on "Start TSS Server" in the upper right side of the Tiny Umbrella window
STEP 3: Open iTunes
STEP 4: Once iTunes has recognized your device, hold down SHIFT + click RESTORE in itunes
STEP 5: Point iTunes to the STOCK 4.1 ipsw (make sure there is no SIM card in the phone at this point)
STEP 6: Once the restore is done you will get an error message 1015 (this is normal), click OK and exit iTunes
STEP 7: Go to Tiny Umbrella, click on Exit Recovery (make sure your device is selected on the left)
----(Aft you exit recovery & the device reboots, you may already be out of the loop, follow steps regardless)----
STEP 8: Insert AT&T sim card and reboot (ONCE REBOOTED, YOU SHOULD BE OUT OF RECOVERY, THATS RIGHT, NO ITUNES LOGO..)
STEP 9: You should see an alert message on your device ("Waiting for activation, this may take some time") assuming its an old sim
STEP 10: Exit Tiny Umbrella, Start redsn0w and point it to the stock 4.1 fw (yes, 4.1 ~ DONT WORRY ABOUT 4.2 RT NOW)
STEP 11: All you need to select is Cydia & Enable Battery % if you want it (custom logos for those who know)
STEP 12: Enter DFU per the on screen instructions
STEP 13: Once redsn0w is finished, you will be Jailbroken
STEP 14: Make sure the 3G is disabled in Settings > General > Network
STEP 15: Find the nearest wi-fi gateway that you can access and start Cydia (this process will be lengthy, be patient)
STEP 16: Once Cydia has finished (select "Complete Upgrade" when prompted in the Cydia update process)
STEP 17: Restart Cydia, search for ultrasn0w and install
STEP 18: Remove old AT&T sim card and install sim of your choosing
STEP 19: Reboot your iPhone with YOUR sim card in it.....
STEP 20: ....look for the name of your carrier in the upper left corner of your phone, shouldnt take long after reboot...

ENJOY!

Please send feed back folks....this process worked like a dream for me...I think the trick to getting out of recov loops is to change the FW version when restoring (so long as you have SHSH files saved)...

Help please! I have jailbroken a iPhone 3G - 4.2.1 - 6.15.00 bb...before I applied ultrasnow I tried to restore with iTunes to activate with AT&T sim card, now the phone is stuck in restore mode (showing the iTunes logo and USB plug) I have tried holding the power an sleep at the same time until shut off an keep holding until the apple appears again but it just goes right back to the iTunes logo an USB plug....I ran through redsnow again an it completes the process but then just reboots into restore mode w/iTunes logo....how can I permanently exit this restore mode? Please help! Anyone?
Thank u in advance!

I did a restore with itunes, it failed (error 1015)...now stuck in recovery mode (not dfu)...tried running it thru redsnow, turned it off, performed steps for dfu mode....redsnow went thru the whole process and then the phone booted right back into recovery mode, asking for itunes...please help

Shall I do an official restore with itunes? (I thought I couldnt do that after upgrading to 6.15.00) ...or through redsn0w? (I just did that and left the "install ipad bb" box empty)...can you please be more specific?

How can I get it to ask for a valid sim to activate while still installing Cydia so as to unlock...thk you for your help!

Affirmitive, iphone sim....will this work just by plugging in then?

Hello all....I would like to thank Dev-Team for all their hard work! I have had my 3Gs happily unlocked for quite some time. Running: 3.1.3fw 5.12.01 bb (Im not sure of bootrom, sn:5K006xxxxxx...im leaning toward new bootrom, does anyone know please?)

Also, I have jailbroken a 3G 4.2.1fw 6.15.00 bb for a friend and will be unlocking it. I have not installed ultrasnow yet and I do have an old ATT sim card handy. The phone is not asking for a valid sim to activate after I have JB it, just alerts that there is no sim installed. Will I be able to avoid the whole battery drainage/overheating issue just by plugging this sim before installing ultrasnow? If not, can someone please provided the steps or a link on how to do this please?

Thank you in advance for you help and attention!