The latest firmware update released by Apple may have improved security and added features, but some iPhone owners are having problems. Reports from users on the Apple support forums indicate a major problem with updating to iPhone OS 3.1 on the iPhone 3G.
Users are ending up with bricked phones, and iPhones that crash several times, requiring a hard reboot. Holding the sleep and home button doesn't always work, however. Some users are finding it necessary to downgrade to iTunes 8 and firmware 3.0.1 to solve the problems.
Other problems turning up include much shorter battery life, and podcasts suddenly being listed in random order instead of sorted by date.
Original iPhone and iPhone 3G enterprise users are reporting even more problems. Neither device officially supports Exchange encryption, unlike the 3GS. Apple did not actually enforce encryption policies on any iPhone devices until iPhone OS 3.1.
In other words, Apple is finally in compliance with the Exchange encryption standards introduced in 2007, and those people without an iPhone 3GS are out of luck. That is, unless their IT administrators disable the Exchange encryption policy.
Some users are opting to downgrade to iPhone OS 3.0.1 to solve the problems (see these instructions). In some cases, a downgrade to iTunes 8 or iTunes 7.7 will also help until Apple releases bug fixes (more help in this FAQ).