Okay so the big problem is that when you upgrade to the latest and greatest firmware from apple it updates your baseband in your phone, if you then try and downgrade to a previous firmware (3.1.3 – IPSW file) it will give you a 1015 error and will be stuck in a recovery mode loop.
I have posted the entire process below, and from this you should be able to restore your iPhone 3GS back to 3.1.3.
- Open iTunes
- Attach you’re iPhone or iPod
- Turn Off the device
- Hold the Home Button in and press the On button (hold the Home button in BEFORE you push the the On button)
- Keep pushing those 2 buttons for around 10 seconds
- You will see the Apple logo but you still need to hold the two buttons
- The device will restart again, a few seconds after you see the Apple logo, and will shutdown.
- Now, hold push the On button of you’re device.
- iTunes will alert that a device is attached
- Press alt and click Restore and locate your 3.1.3 firmware IPSW file (download link below)
After the firmware has been installed it will throw up an error, complaining about 1015 or something and the iPhone will be stuck in recovery mode. The OS is actually correct now, but you just need to give it a little nudge, to-do this use iRecovery (download link below)
- Close down the error in iTunes.
- Make sure the irecovery program you have downloaded is in your working directory so you can run it.
- Open up terminal
- Run the following command to get into “iRecovery console mode” and connect to your iPhone :-
./irecovery -s
- Once you are in irecovery console you need to run the following commands :-
(then from the console)
setenv auto-boot true
saveenv
/exit
After this reboot your iPhone with home and sleep and it will now boot into 3.1.3 as normal.
If you took a backup, after the repair iTunes will ask if you want to restore the backup on your device.
Download Links
iPhone 3.1.3 Firmware, google if you need another firmware (CHECK YOU HAVE THE RIGHT ONE!) (Download)
iRecovery for Mac (Download)
iRecovery for Windows (Download)
If this breaks your iPhone, then I won’t be responsible, but I have tried this as well as a few friends and it’s saved our little iPhones 
Bagwaa
