The fact is even apple considers the 3G->3GS a bigger upgrade than v1("1,1")->3G("1,2"). That's why they designate the 3GS as "iPhone 2,1" as opposed to "1,3". Nearly EVERYTHING internally was upgraded: Processor, memory, graphics, storage, camera, compass, 7.2 mbps 3G capability... there isn't much left to upgrade after all that.
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