i had the same problem!!
Cydia has some Bugs...it can't find the new version of ultrasn0w 1.0-1 according to me. Best thing to do, is as suggested by helloiphone4 to remove the source
repo666.ultrasn0w.com, restarting the iPhone 4.
That didnt work for me to. So i went once more to www.jailbreakme.com on my mobile Safari and Jailbreaked my iPhone once more.Restarted the iPhone 4G and guess what? it found the updated ultrasn0w version!!
Let me know!!