1. Set Settings → General → Auto Lock → Never
2. Start Installer and update it if it asks. Tap on Sources, Edit, and Add http://i.unlock.no/ as a repository.
3. Make sure you have BSD Subsystem installed. If it's installed it's listed in "Uninstall", if not listed, tap on Install and goto the System category and install it.
4. Now, install The Virginizer found in the Unlocking Tools category. This will take almost 10 minutes to complete.
5. When done, restore your phone to get 1.1.1 firmware reinstalled (this is not necessary if you are going to upgrade to 1.1.2)
6. When phone has been restored, you can Activate and unlock as normal.

How do i downgrade a 1.1.2 or 1.1.3 phone?
Downgrade the main firmware:

1. Connect the phone to the computer and launch iTunes (v7.6 NOT recommended).
2. Restore your phone like explained in details here.
3. You will get an error when restore is complete, just ignore it and run AppTapInstaller.exe (to Mac users: iNdependence should do the same.
4. AppTapInstaller.exe will fail, but your phone will get to the Activation Screen now!
5. When on the activation screen, just follow my tutorial to jailbreak and bypass activation

Now your phone main firmware is ok, but to get the phone part working properly you should also downgrade your baseband firmware. At the moment this is NOT possible if your phone already had 1.1.2 or 1.1.3 when you bought it (meaning it has the new bootloader). If you accidentally upgraded your phone to 1.1.2 or 1.1.3 and want to go back to 1.0.2 or 1.1.1, read on.
Downgrade the baseband firmware:

1. Set Settings → General → Auto Lock → Never
2. Start Installer and install BSD SubSystem found in System Category.
3. Go to Sources and tap edit and add http://i.unlock.no/
4. Now install "Baseband Downgrader" found in Unlocking Tools category. This will take around 5 minutes.
5. When done, restore your phone to get 1.1.1 firmware reinstalled.
6. When phone have been restored, you can Activate and unlock as normal.

Can't find AnySIM - Unlocking Tools category is missing

Please follow the tutorial carefully - it will show up after you add my repository (http://i.unlock.no) and tap refresh.
YouTube is not working

If YouTube does not work ("You must first connect to iTunes..."), try to install YouTube activation which is found in the Unlocking tools-category after you have added my repository (see previous question)
Is the unlock permanent? Can i restore my phone or upgrade it?

This unlock method is based on a firmware patch, so everytime the baseband firmware is flashed, the unlock will not work anymore. You should be able to restore without loosing the unlock, and you should also be able to upgrade to future firmwares as long as the baseband firmware is not updated, but never perform a software update before you have specifically read that updating is safe.