Backed up first, SHSH blobs and all. Get TinyUmbrella if you don't already have it. TinyUmbrella helps you manage ipsw installations and saves your SHSH blobs. You might want it. You might not. Up to you.
I Downloaded the GreenPois0n RC5 file from Greenpois0n.
RC5 went through a few releases and the b3 file was what finally worked.
(RC6-1 is now available)
Now I'm downloading the update in iTunes...slowly.
FWIW, I'm going to follow the instructions here:
Updating iPod to 4.2.1
iTunes gave me a dialog telling me to wait for the iPod to restart and that it will show up in iTunes.
Time to jailbreak. Give me a minute to run Greenpois0n...
If you are using Greenpois0n RC6_1, you can skip this part.
Because Greenpois0n failed in my initial jailbreak attempts with RC5 b1 and b2, when I used b3, I found some more helpful information here.
RC5 b3 instructions
Open up Terminal.app in the Utilities folder.
Type cd /Users/(your username)/Desktop (hit enter)
Type open (then a space)
Drag Greenpois0n to the desktop
Right click on Greenpois0n and select Show Package Contents
Navigate to greenpois0n.app/Contents/MacOS/greenpois0n
Drag that file (it has a black Terminal-like icon) into your terminal window.
Greenpois0n should open. Follow the instructions.
Follow the on screen commands.
Make sure your iPod is plugged in. (I chose not to have iTunes running.)
Click the Jailbreak button.
Press and hold the sleep button - A countdown will guide you.
Continue holding sleep and press the home button - A second countdown will begin.
Let go of the sleep button and continue holding home.
Continue holding home!!!
Your iPod will show a white screen. Just keep holding the home button.
A command line interface will show up on your iPod when the jailbreak is being applied.
Click Complete when done. Your iPod should reboot on its own within seconds.
Install Cydia from the Loader that shows up in your Springboard. Remove the Loader, etc. Then install OpenSSH and so on and so forth. Additional instructions are available in my previous post where I jailbroke 4.0 and 4.1.
Make sure you change your admin password from "alpine" to something else. Everyone and their mother knows the password is alpine, so changing it is really a good idea, folks.