iPhone Dev Team is all set to release RedSn0w 0.9.7 beta4 to untether your iOS 4.2.1 jailbreak on iPhone 4, iPod Touch 4G, iPad without the need for usbmuxd and will expand to Windows later, as confirmed via twitter. It requires access to the iOS 4.2b3 firmware and your iOS 4.2b3 SHSH blobs saved. If you rely on the ultrasn0w carrier unlock, please do not use this updated redsn0w tool.
Today’s beta4 will eliminate separate usbmuxd process (so many more Mac users canuse it). After that, expand to Windows.
How to Jailbreak iOS 4.2.1 with redsn0w 0.9.7b4 (Untethered)
Currently, the untether is Mac only but the next update will bring Windows support. Download the Redsn0w 0.9.7b4 for Mac OS as and when available and use the tutorial guide to untether jailbreak 4, iPod touch 4 or iPad running iOS 4.2.1.