If you’re planning on buying a new iPhone, feel free to update to 1.1.1. You can do the anti-AT&T nasty all by your lonesome thanks to a new version of AnySIM. Remember: if you’ve unlocked your older iPhone then you might have some issues until the Dev Team figures out how to return your phone to its virgin state. If you used iPhoneSIMFree, however, you’re golden anyway.
Generally, the 1.1.1 update isn’t worth the effort, but if you must have Wi-Fi iTunes, do it up, Wedge.