How to manually update your Nexus One to Android 2.3 Gingerbread

The Nexus One's over-the-air update to Android 2.3.3 Gingerbread (erm, not Android 2.4) is starting to push out. But if you can't wait (that'd be us), you can manually install the update. It's the same thing as the OTA update, just, not OTA. Here's how to install:

1. Download the update from here. [link via XDA]
2. Rename the file to update.zip. Note that if you're using Windows, just rename it to "update" (no quotes, of course) because it's already a zipped file.
3. Copy the update.zip file onto your microSD card.
4. With your Nexus One off, hold down the trackball and press the power button.
5. You'll be booted into a white screen with three Android robots on skateboards. Select "Bootloader."
6. On the next screen, select "Recovery."
7. Your phone will reboot, giving you a picture of the Android robot and an exclamation point inside a triangle.
8. Now press the power button and volume up button at the same time. It could take a couple of tries.
9. Now (using the trackball this time) choose "Apply sdcard:update.zip" and let things run their course.

Easy peasy! Enjoy!
Update:  Seeing getprop/status 7 errors?  You'll need to update your version of Hboot.  If you're not familiar with fastboot and flashing, have a look here for the long (but easy) way.

Source: AndroidCentral