Even though Comex said he wasn't sure he was going to be able to meet his Christmas deadline for an untethered jailbreak, it does seem we'll get a nice gift from the Dev Team after all. According to the Team's blog, an updated version of RedSn0w that implements a "backup plan" will be released and will deliver an untethered jailbreak for iOS 4.2.1.
Things seem to be rushed a bit as the Dev Team is looking for beta testers to run this RedSn0w untethered jailbreak and make sure every bug is taken care of before the public release...