No, it does not decrypt retail EBOOT.BIN's, nor will it unpack retail PKG's.
To elaborate, when attempting to "decrypt" EBOOT.BIN from a game update, you get an invalid file input error. When attempting to unpack a retail .pkg, you get an empty dir with the serial # (title id/game id) eg the dir BCUS12345 is made, but it's empty.
This PKG Tool is essentially a mobile version of the SDK, couple apps from host\win32, so because these tools originally couldn't decrypt or unpack retail eboot.bin/pkg, there's no reason to think this tool would.
Last edited by 3o9; 09-27-2010 at 12:15 PMReason: Elaboration
I didn't follow up all the details on the jailbreak, since I got my PS3 back just today v3.15 so does it turn a retail into a debug? and you can only run debug selfs? if not for unpacking / decrypting retail packages with the groove + ftp you could just get some files in the download queue and check the files mentioned in the thread, the format is easy to figure out you have to remove the title id in the download-task so you don't get an error if you replace the link/file with another one.
if anyone is going to give it a try and needs some help with the format of the tasks, drop me a note.