You will need newest iTunes to work. –http://www.apple.com/itunes/download/
Ok lets get started.
SYNC your iPod/iPhone BEFORE STARTING.
!!!UPDATING YOUR FIRMWARE WILL ERASE EVERYING!!!
-To get the firmware go tohttp://www.felixbruns.de/iPod/firmware/
-Go to the bottom section “iPhone / iPod touch”
-Click the little arrowing thing \/ the Dropbox.
-It will open alittle selection thing, look for your type of iPod/iPhone.
-After you find your type of iPod/iPhone .
-Select the “iPod/iPhone,”1G,2G,3G”(3.1.2/7D11)
-Click Download after you selected it.
-Best place to download it is your Desktop
-If it is a .rar file or a zipped file-
-Change the name to iPod2,1_3.1.2_7D11_Restore.ipsw
(or just add .ipsw at the end)
If you don’t know how to rename, right click the file and click rename, or properties.
-Okay, now your done with the file.
Now, plug in your iPod and open iTunes
-Note-You will need to update your iTunes in order for it to work.
On iTunes go to DEVICES and you should see your iPod/iPhone.
Open you iPod/iPhone and go to the Version section.
If it say Check for Update, check it and then cancel if it ask you to buy.
-Now hold Shift (on the keyboard) and click Update (While holding Shift)
-It should pop-up a file selection.
-Locate your file or in the search box, search iPod2,1_3.1.2_7D11_Restore.ipsw
-Click it/Open it
-It should start updating for you, it should take a couple of minutes.
After it finish loading, you should have 3.1.2. Firmware.
Warning: If you use this way to jailbreak you CAN’T play jailbroken apps!!!
You can only use 3rd party apps, Cydia and the apps you can get with cydia.
BUT YOU CAN’T GET APPS FROM APPULOUS
Only apps Cydia have.
Okay lets begin, this is the easiest way to jailbreak it and the only way I know it works.
Go to http://blackra1n.com/
On the bottom of the page select your system Flag- Windows, Apple -Mac
Click it and it should start downloading. Should download on Desktop.
After downloading plug your iPod/iPhone.
Run the program blackra1n
When it open click Make it Rain
Then it should start loading.
Shortly after it is done, your iPod should be jailbroken.
On your iPod there will be a blackra1n logo.
You can install cydia and rock there.
Comment if you need help.