In desparate need of help with deciding how to go about upgrading it to 1.1.1

Because mine was a bought-unlocked iphone, therefore I do not know how the guy did it.

It looks like a 1.1.1 firmware downgraded to 1.0.2 then unlocked and working.

I live in HK you all see, and I do absolutly need chinese input for all apps which has recently been released.

However, I am so so so confused with all the unlocking methods out there and most of which mention it is a complete must for the following:

A - 1.0.2 firmware version 03.xxxxxx (forgotten now, since mine is not anywehre near it)

B - brandnew 1.1.1 out of box

I am so confused, for mine is as suggested in the title, a version 1.0.2 but with firmware 04.01.13

Any experts can help me on this issue I will be more than grateful.

One guy has told me that because my firmware is 04.01.13 therefore I can just simply use itunes to restore my currently known as iphone (but could possibly turn into an ibrick if not careful) and then just perform jailbread and then activate because the baseband is not scratched or damaged.