Using tethering without actually *paying* for it is against the EULA, and both Tmob and ATT have made it clear that if they believe you're tethering (excessive data usage) they'll charge you for it.
In this situation, I'd opt for doing the correct thing and paying for what you're actually doing, instead of using software to steal it.
As for how I jailbroke, its been a while but I believe I used ultrasn0w for 3.1.1 and blackrain for 3.1.2 on my iPhone, and then the tether-free jailbreak for 4.0.1 when it came out. My iPad was GreenPoison.
I'm curious about the lock-ups, etc. My phone has never locked. I've had it restart SpringBoard in Safe Mode after I put some prototype MobileSubstrate apps on. I think the biggest thing to do is make sure any Cydia/Rock/etc apps you install are actually going to work on your device / OS version. Installing unsupported apps could cause crashes, I suppose, but I never did.
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