CAUTION: You do any of this at your own risk and this will void most warranties from most if not all carriers. That being said, if you follow instructions it can be fun and easy and even if you run into problems, there are a lot of great and friendly people out here who are more than willing to help.
The first thing you'll need to do is root your phone. Rooting will give you access to the phone's storage. There is a terrific one-click root method found here:
Pete's Motorola Root Tools
Follow the instructions as they're laid out and you'll be fine. I actually had to use the Windows XP workaround and can attest that worked fine for me.
Once you have root, check it out. If you have your phone plugged into your pc, change the USB connection from "charge only" to "mass storage device". Go into windows explorer and you'll see two new drives out there (assuming you have added a memory card). That's your phones internal memory and installed card. Success! But you probably won't want to stop there.
The best next step is to get a few key apps to help anyone who has rooted their phone. I would start with the following:
ROM Manager (thanks koush):
Droid 3 Bootstrap (thanks hash of codes):
Hash of Codes: Stock CM Bootstrap for Droid 3
Oh and before I forget, please try to donate to these guys! Through their hard work many of us who are new to this and even the experts are able to really use our devices the way they were intended to be used (that is the way we want to not the way your provider decides you should)
Now, before you do anything, you'll want to do a "nandroid backup". This will allow you to get back to your current phone state if you encounter any problems. The steps are as follows:
1. Open Droid 3 Bootstrapper.
2. Click the top button (Bootstrap Recovery) and wait for it to complete (note the first time you use this or any other system application it may say it needs superuser access to run...just grant it!
3. Now click the bottom button (Reboot Recovery) This will boot your phone into the boot menu
4. Use your volume keys to toggle to backup and restore and use the power key to select
5. Use the power key to select backup. This will take 5-10 minutes.
6. Reboot your phone
After reboot I also backup my phone with ROM manager. I don't know if it is necessary or not but I do it just in case.
Now you can start flashing ROMS. What does this mean? Well, think of a ROM as a new framework for your phone. Verizon's custom rom runs a lot of "bloatware" (that is programs that slow the system that you may or may not want to be running in the background). So basically, people create custom ROMS. These ROMs allow peolple to load something that has the bloatware removed for a more customized experience. The ones I am aware of for the droid as of Oct 2011 are below. I am sure there are others and certainly more on their way.
Steel Droid (seems popular and I liked it with the exception of missing my universal inbox)
Monster (very bare bones which may appeal to you)
NOTE: As of 10/2011, this DOES NOT work with CM7 which requires a different procedure!
I am going to use Steel Droid as the example here. The first thing you'll need to do is download the ROM file which will be a .zip file. Steel Droids can be found on this site on this post:
[RELEASE] Steel Droid: 3.0 Gingerbread - 10-16-2011
1. Download the .zip file to your PC.
2. Next, connect your phone to your PC and choose mass storage device.
3. You now want to copy the .ZIP file from your PC to your phone. The drive you're looking for has "MOT" next to the drive letter in windows explorer. It's your phone's internal storage drive. Copy the .zip file to the root drive.
4. Once that is complete, open Droid 3 Bootstrapper.
5. Click the top button (Bootstrap Recovery) and wait for it to complete
6. Now click the bottom button (Reboot Recovery) This will boot your phone into the boot menu
NOTE: Control of your phone in the boot menu is as follows (Volume down - move down: Volume up - move up: Power button - select)
7. Using your volume keys you want to "install zip from SD card" then "choose zip from internal SD card" and then select the .zip file that you downloaded (in this case the steel droid .zip file)
8. Your now want to reboot. Your phone will begin rebooting. This WILL take a little while (tough to say....but LET IT GO should be 5-10 minutes!!!) Do not mess with it. It will reboot.
Congratulations, you have just flashed your first ROM. The process can be used to FLASH any rom to your phone.