I have a 3G iphone with version 4.2.1 (8c148) and modem firmware 05.15.04

Can i jailbreak this? if so what do i need to do? i use a laptop with xp home

You should be able to open up Safari on your iPhone and browse to the website jailbreakme.com.

It does it all for you. Make a backup on iTunes before you do it though.

Im not sure jailbreakme can do firmware 4.2.1 for 3gs

But useful site with a jailbreak chart

a great quick q and a site

and a great forum site

and remember to save your ssh blobs once jailbroken, look for tinyumbrella

http://www.jailbreakmatrix.com/tools/sn0wbreeze-2-2-1

just found above, but would this work? i have tried different things before but give up.

yes should be fine

Well I tried the jailbreak but failed what I did was backup my iPhone to iTunes, I had to reinstall but are now missing my apps which I had to pay for I have looked on iTunes but they are gone? Were are they?

What failed, what errors.
Never seen a failed jailbreak.
What do you mean by a reinstall?

when your restore your backup from itunes it does the following;
'You can use iTunes to sync content on your computer (such as music, applications, podcasts, videos, ringtones, photos, notes, email account settings, contacts, calendars, and bookmarks) with your iPhone or iPod touch'

So if you restore your backup (the one you saved earlier) it will put back your purchased apps.

But still, the jailbreak would not have touched them.

Also, if you have "lost" any apps you have previously downloaded, you can simply download them again, without paying again. Just load iTunes, go to the App Store, and then go to "Purchased" in the quick links on the right hand side.

Still, you shouldn't lose anything... Everything should be on iTunes and easily re-syncable.

Ok found them, so I wilk not be charged again if I download then on my phone neither?

No, thats why they get called purchased apps.