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Yes, Apple's latest software update for the iPhone brings a lot of cool new features to the party. But should you install it if you've jailbreaked your iPhone to run third-party software or unofficially unlocked it to support cellular networks other than AT&T's? The short answer is no.

As expected, firmware 1.1.3 re-locks iPhones that have been unlocked through both software and hardware unlocks. It also renders all unofficial native iPhone software unusable. Here's the real problem, though:

Once you've installed 1.1.3 onto your iPhone, you apparently can't downgrade from it to an earlier version of the iPhone's firmware without sacrificing your smartphone's phone functionality.

That means there's no way to get your iPhone working with unsanctioned carriers again once you've upgraded, at least for now. And while you can get unofficial applications running by downgrading, it's without all the benefits of 1.1.3 or the ability to make phone calls and access the Web over your carrier's cellular EDGE network.

If you've upgraded your iPhone and would like to downgrade from 1.1.3 to an earlier firmware, click here for detailed instructions on how to do so over at tuaw.

Remember, instead of a fully functional iPhone, you'll be getting, in the words of tuaw, "a glorified iPod touch."

The hacker community is surely working on a workaround that'll allow you to install 1.1.3 without sacrificing your unofficial software or relocking your iPhone if you've unlocked it to run on cell phone networks other than an official Apple carrier. After all, it has been quite successful in cracking Apple's iPhone software updates up till now. There's no reason to believe it can't do so again.

More Problems Reported
In addition to wreaking havoc on unofficial iPhone functions, 1.1.3 is apparently causing some users who haven't strayed from Apple's party line some headaches as well.

First off, it's being reported by some iPhone owners under AT&T's pay-as-go GoPhone plan that they're losing access to the carrier's EDGE data service after upgrading to 1.1.3. They're receiving the message: "You are not subscribed to the EDGE network." Worse, some say they aren't receiving much in the way of support from AT&T.

One member of AT&T's Apple forum warns that when he called tech support, "they temporarily 'fixed' it but in the process I got charged by the kbyte ($15 for two websites). AT&T reversed the charges and repaired the billing problem, but said that I will be charged by the kbyte until this problem is fixed (no ETA) and will have to call in for every charge to get it reversed."

Additional upgrade problems include 1.1.3 failing to load successfully, leaving some users iPhones in recovery mode or failing to restore after the failure; the loss of sound output for both the iPhone's internal speaker and earpiece; the rendering of some previously compatible Bluetooth peripherals incompatible; and messages failing to download to the iPhone’s Mail application after the installation of 1.1.3. There are even those who've reported having their iPhones ibricked after upgrading, even though they’ve never hack their iPhone.

One potential (albiet fairly generalized solution) to these problems involves making sure you are running iTunes 7.6 when attempting to install firmware 1.1.3 onto your iPhone. Upgrading to iTunes 7.6 has apparently even allowed some of those who previously failed to upgrade their iPhones or ran into some errors while doing so under an earlier version of iTunes to install 1.1.3 successfully afterwards.

You can also head over to head over to iPhone Atlas, which has posted some fixes posted to some of the specific errors mentioned above.