This method will support: FW v2.0.1, v2.0.2, v2.1.0, v2.2.0, v2.2.1
For iPhone 2G, iPhone 3G and iPod Touch 1G
It will install Cydia and Installer.

I take not responsibility for broken iphones or ipod touches. Follow this method at your own risk! Be warned that Apple have officially claimed that jailbreaking is illegal.

Mac
Download QuickPwn_2.2.5 which you can download here.

windows
Download QuickPwn-225-2 at here

Quickpwn
Open the QuickPwn and connect your iphone or ipod touch and follow the instructions.

DFU mode
When you have to entered DFU mode it can get a little tricky so If you are having problems doing it try following this. (If your are on a mac using leopard 10.5 you will need a connect via a USB hub)

1. turn of your device.
2. hold the home and power buttons for 10 seconds
3. Release the power button and wait for your iphone to turn on.

If you get "I haz success" like the picture below you have jailbroken your iphone or ipod touch!!!
If you have any problems contact me on my forum Night Gamer I will be happy to help =D.