iPhone 2.1 Software Update Arrives; Is 3G Fixed?

The iPhone 2.1 software update, which has been long awaited (long, because despite only being announced at Tuesday's "Let's Rock" event, long-suffering 3G users have been waiting for an improvement in 3G support since the iPhone 3G's launch), has arrived.

Interestingly, once again it installed "Apple Mobile Device USB Drivers," which had also been installed by iTunes 8.0 when I installed that yesterday (yes, on Vista). The download is 237.8 MB, and for once Apple is fairly open about the changes.

Not only does the software show release notes when downloading (above), they've even gone so far as to put up a web page with details.

Here are the details (emphasis mine):

The iPhone 2.1 software update contains many bug fixes and improvements. To get it, connect your iPhone to your computer using iTunes 8 and click Check for Update.

Update includes:

• Decrease in call set-up failures and dropped calls
• Significantly better battery life for most users
• Dramatically reduced time to backup to iTunes
• Improved email reliability, notably fetching email from POP and Exchange accounts
• Faster installation of 3rd party applications
• Fixed bugs causing hangs and crashes for users with lots of third party applications
• Improved performance in text messaging
• Faster loading and searching of contacts
• Improved accuracy of the 3G signal strength display
• Repeat alert up to two additional times for incoming text messages
• Option to wipe data after ten failed passcode attempts
• Genius playlist creation

The question is, does "improved accuracy of the 3G signal strength" display mean it'll just show different bar results, but still perform poorly when compared to other 3G phones in the same area (within inches, in my informal testing)?

Still updating, will update this post when I'm done testing.

Update: The update took around 20 minutes.

And, well, the phone came back up, and I immediately switched it to 3G mode (I had been permanently in EDGE). Shocked to see a "No service" message. After a short time, I received 1 bar. Powered the phone off and back on, and now I see 3 bars, which is in line with what I would expect. Now: does it perform well? Does the strength indicator fluctuate simply by being moved an inch?

Bluetooth was on, but disconnected from my headset. A couple of taps on the headset to initiate a call and it reconnected just fine.

Wi-fi seems OK.

Update 2: Inside info: I know someone in QA at Apple. This release fixes several 3G issues. No details, just that info.

Update 3: Obviously still very early, but besides myself, two others I know have a) downloaded, b) made several calls on the phone (in the SF BayArea). So far, no dropped or missed calls. We are impressed so far. Or perhaps, since this should have been done right in the first place, happier, so far.

Update 4: So far, so good. I assume people will now admit that the issue was at least partly with the phone. If not, they could not have fixed it via software. As I previously said, the fact that other 3G phones in the same area were performing well while the iPhone 3G ... well, sucked ... as well as worldwide issues, showed it could not be AT&T's network alone. It's still early, though.