After updating to OS 3.0 my iPhone started exhibiting problems with battery. The battery would not charge at times, it drained fast and the phone ran hot. These are the steps I took to fix the problem.
Following these steps, I was able to fix the battery problems and the phone now runs as cool as it was under the previous OS version. My guess is that step no 3 alone would be able to fix most problems, but it didn't do it for me.
A lot of people are experiencing these issues and there are a ton of posts on apple forums. It may be due to iTunes not resetting your phone properly or because of bugs in OS 3.0. I have never seen this widespread complaints about an OS update affecting battery so far especially charging, so it is more likely that the problems are caused by OS 3.0 bugs.