TIPS from my experience... (7 16gb iPhones unlocked so far with iPlus 1.2)
1. Once you start iPlus running, walk AWAY from the pc. Make a cup of coffee and drink it. Come back and it will be done. If you sit and stare at it, you will think it has finished, or not worked.
Even when the cmd line has finished, the iPhone is still being worked on.
2. If you get an error "your phone needs repair", rerun iPlus -u. It WILL fix it. No need to restore the FW first.