Well seeing as you got cydia to work, I'm going to make a few assumptions... Whatever version of the jailbreak you are running, you installed correctly and rebooted correctly, if that was required...
Now, dreamboard is quite stable, so I can't imagine an infinite respring or complete freeze... THAT BEING SAID... When you say you restored and it's still frozen... That is a problem... A big problem!
If you plug it into iTunes... Open iTunes... Put it in dfu.... (power for three seconds, then, while still holding power, hold home for ten seconds, then let go of power, but keep holding home until iTunes finds a device on recovery mode) and clock on restore, and your phone still doesn't work... Pretty much you are S. O. L.
I've said it before,if iTunes can't put your phone back to stock youve got a broken iPhone...
Where did you get this iphone4?? When did you jailbreak?