In many cases , the Cydia application fails to install or update apps after jailbreaking your Iphone with v3.0. There seems to be a conflict with the ICY and Cydia Apps installed on the jailbreak.
1. Backup your phone
2. Re-jailbreak your phone using redsnow.
3. Deselect Cydia,
4. If you’d like ICY installed select ICY
5. When the jailbreak completes, you should have a working install of ICY and Cydia.