The freezes are pretty much irrelevant, there's nothing even remotely tinkering with anything that could cause this kind of stuff in a jailbreak. Can't speak for KIF, though, but I've personnally never had any issue with it

.
I'm assuming you originally weren't running FW 3.1, but got the update somewhere along the way? That shouldn't be an issue, the jailbreak you used does handle FW 3.1 fine.
So, there's only one question left: What *exactly* do you mean by 'fail'? U007 error? 0003 error? Something else?
And, no, a downgrade is not (easily) feasible.