Remember that bit where I said upgrading from 1.1.1 to 1.0.2 was a one-way trip? Looks like I spoke prematurely. Tonight, reports are trickling in about successful 1.1.1-to-1.0.2 iPhone firmware downgrades using this method described at the "iPhone Devteam" wiki, which relies on a combination of firmware-fu and the INDependence software. TUAW reader skwasha tipped us off to an ongoing conversation at the hackint0sh forums that got the ball rolling on this.
I have not yet been able to confirm this downgrade so let us know in the comments if the method worked for you or not.
Update: After downgrading your iPhone will most likely not work as a phone. But you'll be able to use it with third party apps and WiFi. Developing.
Update 2: More detailed instructions here at Nate True's blog.
Update 3: This method is now called "pulling a kmac" after the original poster who figured this out.
Update 4: If you're getting the "Please Connect to iTunes" thing, you'll need to set some environmental variables. You can do this with either iBrickr/iphoneinterface or with iPHUC. Instructions for both at Nate's blog.