First of all, the iPod Touch 2nd Gen cannot be jailbroken on 3.1 (Look around online first before asking?). The Dev Team's Website clearly says so (In bold I might add. If you want to find the site, just go to google and search "iPhone Dev Team").
Use the 3.0 firmware and redsn0w for mac to jailbreak your
iTouch. The 3.1 jailbreak should be out soon.
A side note: If you use redsn0w and you get the "waiting for reboot" and the
iTouch does not reboot, simply unplug and replug the usb cable into your computer and the jailbreaking process will continue.