Original iPhones (metal back, silver color, referred to as 2G iPhone) are blessed with a fully unlockable baseband 04.05.04_G. It entitles the iPhone 2G to be easily hackable. So lets get the ball rolling and get to the latest 3.1.3 firmware with a full unlock, jailbreak and activation in place!
Step by Step :
Download redsn0w 0.9.3 from downloads section and extract them to your Desktop [Both Mac and Windows versions of redsn0w are available there]
Connect your iPhone 2G to your PC/Mac and launch iTunes [Update iTunes to the latest version]

Update to …

I was trying to Jailbreak an iPhone 2G, iPod Touch using redsn0w 0.9 and interestingly enough, had the same issue “stuck at Waiting to reboot” message in redsn0w in both instances. I tried both Mac OS X Leopard and Win XP with no avail.
UPDATE : I faced the same issue with iPhone 3G and 3GS too! Fortunately enough, it has a simple solution.
Solution : When you see the ‘Waiting for reboot’ message in redsn0w, unplug the USB cable from the iPhone and plug it back in! Weird but it worked …