I took my chances with this and had success, surprisingly really. I thought I would get an error since I am a Windows user and just upgraded to iTunes 8, plus many are complaining they are getting errors, but I had success.
I didn't do it in DFU mode. I just hooked up my 3G phone to the computer. iTunes recognized it and prompted me to update to the newest 2.1. I said no, and hit shift+Restore to select the custom ipsw and it did it's job. Where as in previous restores that I had done, iTunes would try to activate my phone, but this time around either it did it so fast that I didn't notice it or maybe they're doing something different, cause I got a prompt on my phone saying my iphone is activated. Never seen that one before.
Anyways, just wanted to report my success for those Windows users aching to get it up and running. It works with iTunes 8.
BTW, I did notice the Installer icon was slightly off. It seems it's slightly lower than the rest of them. Weird. But it works though.