If you want to support iPhone OS 3.0 what compiler should we be using?
previously I was using gcc 4.0, but this now gives build errors w¡th SDK4.
I built with gcc 4.2 and it works on a iOS4 device. I have no idea if it'll break on OS 3.0, because I can't build for those devices anymore.

gcc 4.2 should work just fine, as far as I know.

Apple appears to be strongly recommending that everyone move to LLVM (or at least LLVM-GCC) as soon as possible. I've had no problems compiling for OS 3.1.3 with LLVM 1.5 but I also have a 3.1.3 device to test on - I wouldn't do it blindly. For what it's worth my last GCC 4.2 builds worked fine on OS 3.1.3 too.

I will also suggest GCC 4.2 it will be good for OS 3.0

Bit of an old thread but I should mention that I've run into problems compiling for iOS 3.x with LLVM 1.6 (in the latest non-beta Xcode). I'd still recommend moving to LLVM sooner rather than later, but LLVM GCC 4.2 is the best you can do if you still need iOS 3.x support.