The 'I' piracy app isn't supported on iPhoneForums since it is piracy and is illegal, so you won't be getting any assistance with respect to that.
Open up Cydia, and on top of the main page, there should be iOS: and a list of iOS following. The recommended iOS to upgrade to if you want a jailbreak is iOS 5.0.1 or 5.1.1 because they're untethered, stable and many apps and tweaks mandate iOS 5 minimum. If you see iOS 5.0.1 or iOS 5.1.1, it is recommended that you upgrade to one of those iOS. If you do see one of those, or if you see iOS 4.3.3, you can follow these steps to upgrade to the iOS that is listed on the top of Cydia.
Download the iPhone 3GS IPSW that corresponds with the iOS that is on top of the Cydia home page. Yes, it MUST match the one you're trying to upgrade to. You can find it here.
http://www.iphoneforums.net/forum/i...ple-ios-firmware-download-links-iphone-17213/
Download RedSn0w 0.9.15 beta 3 here for Windows
https://sites.google.com/a/iphone-dev.com/files/home/redsn0w_win_0.9.15b3.zip?attredirects=0&d=1
Run RedSn0w as administrator. Go to Extras > Even More > Restore. Select IPSW and point it to the IPSW that you downloaded. Then for blobs, select Remote and they'll be retrieved automatically. Then select Next, and the stitching should begin. Then a few prompts should come up tell you that your baseband will be upgraded are you sure you want to do this, and that your iPhone's data will be deleted and cannot be retrieved (make sure you back up your iPhone). Agree to all of them and it should restore. Follow the on-screen instructions at all times. Once the restore is finished, you will need to do a recovery fix, which can be done in RedSn0w in Extras > Recovery Fix. Again, follow the on-screen instructions to kick it out of recovery mode.
Now you can jailbreak. If you don't have iOS 5.0.1 or 5.1.1 blobs, that would mean you're on iOS 4.3. iOS 4.3.3 is the recommended iOS for iOS 4.3.X since it is the pretty stable. If you're on any iOS from iOS 4.3 to 4.3.3, you can use JailbreakMe directly on your iPhone to jailbreak the device. If you're on iOS 5.0.1, you can jailbreak using RedSn0w or Absinthe depending on which iOS you're on. RedSn0w works for any and all iOS for the iPhone 3GS.
To jailbreak using RedSn0w, run it as admin again, go to Extras > Select IPSW and again point it to the IPSW you selected earlier when restoring. Go back, and click Jailbreak. Put your iPhone in DFU mode, tick Install Cydia, and wait.