This is the best and easiest to follow method for jailbreaking the iPhone 3g on Windows.
Disclaimer: Jailbreaking your iPhone could void your waranty.
I am in no way responsible to any damage that may result by following this tutorial, so proceed at your own risk!

This method works really well and does not require any patches to get iTunes working.

Before you start, make sure you are running iTunes 8 and make sure your iPhone is running version 2.1
To see what version your iPhone is running goto Settings / General / About on your iPhone.

It is also a good idea to sync with iTunes before proceeding so you have a recent backup.

1. Create a new folder on your desktop named Pwnage
2. Download the following files and save them to the Pwnage folder created in step 1
   • Windows QuickPwn 2.1
   • iPhone 3g 2.1 IPSW firmware
3. Run a Virus scan on the files you just downloaded - just to be safe
4. Extract QuickPwn21-1.zip (right click extract all)
5. Make sure iTunes is not running and that iTunes will not automatically start up when you unplug and plugin your iPod.
6. Turn off any virus software you have running. This will make the process go faster and lessen the possibility of your Windows machine hanging during the process.
7. Plug in your iPhone via usb
8. Double click on QuickPwn.exe and follow the on-screen instructions.

QuickPwn.exe has very easy to follow on-screen instructions that walk you through the process. You will be asked to hold down buttons for various lengths of time and the installer will start timers to help you through this process.

For a more in-depth How-To see
http://www.theiphoneblog.com/2008/09/29/how-to-jailbreak-iphone-21-windows-edition/