There have been lots of reports like this going around and I can confirm my 3GS with 3.0 firmware is overheating as well.  It gets quite hot and actually can make your head or hand sweaty when holding it to talk, or simply holding the back cover for any reason.

It's a wonder how the device cools itself at all, considering the only thing that could ventilate air are the 2 speakers at the bottom or the single speaker on the front of the device.

Apple seems to be making a lot of blunders lately, there's a lot of shorfalls in their OS, ranging from the basics such as WiFi (or possibly hardware), battery life, overheating now and lots of other bugs and things that annoy users.

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