here's how u upgrade ur iphone 1.14 to 2.0 firmware....
Step 1: Use WinPWN 1.0 To PWN Your 1.1.4 iPhone. If you need WinPWN Get it:
http://www.winpwn.com/files/winpwn_1..._RC1_Setup.zip
Step 2: Install BootNeuter (Available Via Installer).
Step 3: Run BootNeuter and have it Neuter your iphone
Step 4: Make sure your iTunes version is at 7.7
Step 5: Grab a pre-created IPSW Made with PWNAGE 2.0 Mac. If you dont have one made you can grab one here: iThor\'s iPhone 2.0 Custom Firmware Vanilla (5A347) (download torrent) - TPB)
Step 6:Put your phone into recovery or DFU mode. Note that some users report DFU works best while others are reporting normal recovery mode works best. If you have an error, try swapping modes and toggle between these two types of recovery until one works.
Step 7: In iTunes Shif+Click the Restore button and find your custom IPSW Firmware file.
Step 8: Wait for it to complete! ENJOY!
thanks to: Kinetic-X and NightCrow