Apple usually makes this stuff simple. The 1.1.2 Firmware has been out since yesterday, and iTunes STILL does not know about the new firmware release. I found a link on engadet where you can download the actual firmware. After downloading the 160MB file, and sticking it on my desktop, you'd think a simple double click would start the update.... nope. Double clicking the file opens iTunes, but then it sits there and does nothing. Dang it. Here's how to get that file working... <shift> <click> the "Restore" button in iTunes, it will give you a file dialogue to choose a file, then simply locate the file and click OK.

NOTE: Doing the update this way required me to restore my iPhone to factory default settings during the upgrade, when I chose to restore from my last backup, it applied the 1.1.2 firmware, and then restored my phone from said backup. It took quite a while and I am now syncing all my songs and movies back to the device, doing the update this way, will RESET your phone to factory settings. But as long as you have a recent backup, it should not matter.