So I'm running cydia on 3.2.1 and a few friendly people on here have suggested I upgrade in order to solve a few compatibility issues but I have some questions:

When I upgrade through iTunes it will remove the jailbreak. Correct? Should I un install it myself first as this will be safer and then use redsn0w to re-jail break it?

Cheers

You won't be able to "upgrade" in iTunes. You must do a "restore" which will put a clean fresh 4.3.2 on there, which you can then jailbreak using redsn0w. You will likely need to do the restore by putting your current device in DFU Mode first as it is already jailbroken (see sticky on DFU mode for details)

But, you can restore a backup of 3.2.1 once this process is complete. When you first connect the restored iPad to iTunes it will ask you if you want to do this.

However, I personally do NOT recommend you do this. Restoring a backup of a 3.x firmware onto a 4.x can sometimes introduce issues. If you are looking for a good clean fresh start on new firmware I would recommend not restoring a backup of your old iPad. You can of course still sync all your apps and media back onto the iPad, it's your settings for the apps that you will lose.

You can see my upgrade procedure in the link in my sig. Again, I don't recommend you follow this for a 3.x to 4.3.2 upgrade because you may run into problems with incompatible Cydia apps between major versions of iOS.
If however you feel confident that you can manage those types of problems, by all means use your own judgement.

Hope that helps, and the upgrade is painless!

Thanks for the clear explanation f4780y. I'll pop it into dfu mode tomorrow and get that copy of 4.3.2 on there then jailbreak it again with redsn0w. As this is all very new to me I'll post back with how I got on. Thanks

I put my device in dfu mode and on connecting it to itunes it detected it was in recovery mode. It gave me the option to restore (only option) but on downloading the update 3 times now I get this alert:

"There was a problem downloading the update, the connection timed out. Please check your network settings"

It seems to get to 100% each time. can anyone help?

Try downloading it directly to your desktop from the right link in this thread (make sure you pick the correct version!)

Official Apple IOS Firmware Download Links for iPad

Then in iTunes just shift-click (option-click on mac) on the restore button and it will let you pick the file you just downloaded.

Often a direct download using a browser works better than letting iTunes do it for you...

Thanks for the the swift response f4780y, is it supposed to be a zip file?

Unrared there is no ipsw file. Grrr...

You can just rename the file ending from .zip to .ipsw

Some browsers just change the file ending automatically to .zip for no good reason. Don't extract it, just rename.

No. Your browser has renamed it to a zip. You don't unrar it. You need to rename it to an ipsw from a zip. Then it will be OK.

Haha yeah i just figured it out. Feeling rather sheepish !

Worked as treat. Now to re-jailbreak...