iOS3
Cut, Copy and Paste
MMS
Push Notifications
Jailbroken iOS3 can add SMS character count, full multitasking support etc.
iOS4
iOS3 features +
Folders
Data on/off switch
SMS Character Count
Multi-Exchange Support
Enhanced Mail -Fast inbox switching, All Inboxes, Open attachments in apps
Local Notifications - notifications that do not require a connection to a third party/apple server
Digital Zoom in the Camera
There's most of the day to day stuff from each version. From that you can judge the importance of functionality over speed.