Update 10/13: We've been running iOS5 on a iPhone 3GS for the last 24 hours and have had no problems with it. It runs smoothly and the experience doesn't seem noticeably different from running iOS4. We'll let you know if we encounter any bugs as they come along, but for now it seems safe to say iOS5 works fine on the 3GS. To be safe, backup your iPhone (sync) on your computer and save any photos you have on your device to iPhoto before downloading and installing the update to iOS5.
Just a few weeks ago, some rumors suggested that Apple wouldn't support iOS 5 for the iPhone 3GS. Well yesterday, Steve Jobs had some good news for 3GS owners: you can upgrade your 3GS to iOS 5 when it's released this fall.
The question, of course, is how well will it run and will any features be stripped out since the 3GS doesn't have the more powerful processor found in the iPhone 4 and whatever processor (presumably the A5) that will be found in the next-generation iPhone?
If the video below from a Polish developer is any indication, it seems to run just fine. It's still a little early to tell what, if any, features are missing, but I'm sure we'll have the full skinny before the final release candidate of iOS 5 goes live.
Note to iPhone 3G owners: as expected, you won't be able to upgrade to iOS 5. However, iOS 5 will run on the iPod Touch 3G.