Do you want to jailbreak your iPod Touch 2.1? No problem, you can jailbreak it now! View this guide to learn how to jailbreak your iPod Touch 2.1.
1. Before you do anything, make sure you have a jailbroken iPod Touch. SSH into your iPod Touch using and navigate to the /System/Library/PrivateFrameworks/MobileInstallation.framework folder. Find the MobileInstallation file, and download a copy of it to your desktop. You will need this file later in this guide.
2. Download iPod Touch 2.1 firmware file, and shift-click restore to install this firmware instead of updating to it.
3. Download the jailbreak for 2.1.
4. After uncompressing the folder, run the .exe, choose the iPod Touch, Browse for your iPod Touch 2.1 firmware file and then click the next button.
5. Installer and Cydia should be checked on this screen, so click next.
6. You should see a message on your screen that says “You are now ready to start the PWNAGE process on your device”, make sure your iPod Touch is connected via USB and click next.
7. Follow the on-screen instructions for putting your device in recovery mode.
8. You should see a message that says “The PWNAGE process appears to have completed successfully”. Wait for your iPod Touch to reboot.
Update: GUI Version released, see my other post