ragtag, I personally love my iphone I have the first gen and I feel that it is a great device. If I ever swap my phones over for a day or so I really miss its features such as having access to the full internet that you take for granted once you are so used to having an iphone in your pocket.
About the new 3GS I would like to upgrade mine however I feel that for the few extra features such as upgraded camera and video capture i dont think its enough to make me want to upgrade to this model.
I think what I will do is try the new version of software that is available to all iphone owners a of today and see how I feel about the improvements then and decide if to or not to upgrade.