blackra1n has been doing that for ages
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How is it different from blackra1n?
It differs from blackra1n because:
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It offers custom logos and verbose boot
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It installs Cydia, afc2, and the IPCC tethering hack without needing separate downloads. Because they're all installed in one go, redsn0w doesn't need the multiple levels of installs that blackra1n requires. (Update: the IPCC hack was pushed off to redsn0w 0.9.3 for beta testers, links are below also).
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It uses our original Pwnage bootrom exploit for iPhone 2G, iPhone 3G, and iPod 1G. (Because it's a bootrom exploit, it can't be fixed by Apple without a new hardware release.) Note that redsn0w 0.9 does use the USB exploit for iPhone 3GS and iPod 2G+3G running 3.1.2, but that exploit will be fixed in Apple's next FW release.
Not a huge deal.