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 …

Redsn0w is a revolutionary way to jailbreak, activate, unlock an array of Apple’s devices based on iPhone 3.0 firmware. Devices like iPhone 2G, iPhone 3G, iPhone 3GS, iPod Touch 1G/2G can easily be jailbroken, activated and unlocked (iPhone 2G – Automatic, iPhone 3G – Manually via Cydia & Ultrasn0w).
If you don’t want to go through the following steps and you just want the real deal, follow this guide rather wherein you can download the custom firmware file which should do the job for you!
The tool itself is so neatly packaged …