I did everything with the blobs, but I recently upgraded (BY ACCIDENT, thanks Apple for throwing in your messages where other messages usually are, and confusing me to choosing update.) Anyway, so I have the firmwares 3.1.2 and 3.1.3, and they both give me the same error when updating, says either 3002 or 3194 or 84, one of those.
I used Tinyumbrella, but I am assuming that you can't downgrade from a 4.0 shsh? I did it without even using tinyumbrella on my 3G from 4.0.1 with no problem whatsoever. I also modified the hosts file to various sources, and still no go.