Personally, I'd upgrade but that's just me. I never owned the original iPhone, but I can tell you that the 3G is vital because I don't always have hot-spots (or FREE hot-spots) available. Plus, I'm starting to be a little more cautious with my wifi use after reading Rene's post (and doing a little more research on the subject) about wifi safety. Guess who picks up the slack? 3G.
And having GPS is INCREDIBLY useful. It's not turn-by-turn/voice directed -- that's another topic -- but it's functional enough for my driving needs. It gets the job done, just not as easily I'd like.
So yeah, if you've got the money to spare, I say go for it.