RedSn0w can perform a tethered jailbreak on iOS 4.3.5 for all devices except the iPad 2, according to MuscleNerd.
So those who really do want tethered 4.3.5 can use redsn0w pointed at 4.3.4 (except iPad2)
We strongly recommend that users don't update to iOS 4.3.4 or iOS 4.3.5; however, we will be posting tutorials on how to jailbreak for those who need the tethered jailbreak.
