-based on ios 4.2.1
-use just the latest cydia core files that support ios 4 properly(updating cydia causes device to start freezing and tweaks not showing in settings on both ios 3 and 4)
I know you probably hate to hear this,but I went back to stock 4.2.1 mostly because whited00r was unstable and ios 3.1.3 is obsolete.I usually use my ipod for youtube,facebook,messenger and playing games and thats much worse on whited00r,because youtube doesnt work,messenger doesnt support ios 3.1.3 and the facebook app cant load chats and groups,just the news feed,games crash often because of low free ram I guess.
On other hand:
-ios 4 supports youtube fine
-messenger works fine
-through the latest version of dolphing browser,you can actually access the GOOD vesion of mobile facebookwith reactions and absolutely everything,its just awesome and quite fast!
-games work fine
-ios 4 supports multitasking
Also you get newer api to work with and ios 4 isnt slower than 3 on my ipod 2g,its mostly the same speed(we have crappy old armv6 cpu,its slow on pretty much everything) and also maybe you can add virtual ram,if its possible(idk if our kernel or whatever it is called on ios supports it).