It seems that the Steve Jobs cartoon staring at me after an attempted 3.0 jailbreak with redsn0w, meant that the phone was in recovery mode. Jailbreak failed.
Re-trying to jailbreak did not solve the problem. Instead I restored the phone with iTunes (3.0 fw) and then retried with redsn0w which reflashed the 3.0 fw with the good stuff succesfully.
I guess the correct way to re-jailbreak and re-unlock your iPhone with 3.0 is:
1. Upgrade to 3.0 through iTunes
2. Download 3.0 for iPhone 3G
here, (iPhone 2G
here, and 3GS
here)
3. Download redsn0w
here (download links at the end of the post, both mac and win)
4. Follow the instructions carefully and wait until the process ends
5. If you haven't done step 1, Steve Jobs might greet you in Russian; start over!
6. If you also need to unlock the iPhone, launch Cydia and add the source "http://repo666.ultrasn0w.com"
7. Download Ultrasn0w.
8. Restart!
If all went well you should have an activated, jailbroken and unlocked 3.0 iPhone