Ok after hours and hours I finally got this working. What Poseidon has written up is what you should follow for now until iliberty or ziphone, winpwn ... etc... comes out with an actual working unlock procedure.
Ok, if you are confused on how to put your phone into DFU, Recovery, or Normal just open up iLiberty than use advanced tab to jump it in and out of different modes that you need. Sometimes iLiberty wouldn't work, so ... I used ZiPhone also if you click the drop menu on the right side there are different modes you can get it into I also used that.
Remember on the write up that Poseidon wrote... he Restored 1.1.4 TWICE!!!!
If you feel like you messed up at anypoint just update it to 2.0 and start over from step 1.
I finally figured it out after 3 days and 2 hours.
I have my iPhone back

Thanks Poseidon.