Adobe tries unsuccessfully to turn a molehill of interface changes into a mountain of productivity. Nevertheless, the additions are welcome. In many ways, the interface simply provides better visual feedback on where you are in the path-object-group-layer hierarchy. The Layers palette has better color coding for selections. As you mouse over nodes, they enlarge. Isolation mode imposes visual context as you drill down into a group; irrelevant elements successively gray out, and a trail of breadcrumbs appears at the top of the screen. The breadcrumbs provide a very handy way to jump directly to another object without wondering if you've risen too far up the hierarchy.
Similarly, Adobe has uncomfortably grafted the Flash text-handling interface into Illustrator. In a dialog almost identical to that of the relevant property sheet in Flash, any text block can be defined as Static, Dynamic, or Input. The latter two can be named; assigned an antialiasing scheme optimized for Readability, Animation, with a custom detailed with your own thickness and sharpness antialiasing settings; or limited to device fonts. Dynamic text can be flagged as selectable or boxed, linked to an URL, and have custom character sets embedded. For Input text, you can specify a maximum number of characters.
On one hand, there's now interface consistency between the two applications. On the other, it's a counterintuitive, inelegant, inefficient interface within Illustrator. You must set the font embedding for each block individually; to embed all the glyphs in a given block, you must click an AutoFill button that copies them to a text field. I assume that it eventually compares the blocks and eliminates the redundancy. The thickness and sharpness settings for custom antialiasing have no units; in Flash, you can see the effect each of the settings has as you move the sliders, but in Illustrator, you don't and therefore lack context for the values. Ditto for the antialiasing presets.
Adobe says it also worked to optimize Illustrator's performance, as well, specifically with respect to screen redraws. Unfortunately, after a couple of days attempting performance tests, I can't really draw any conclusions. For instance, on a dual quad-core, 2.66GHz Intel Xeon CPU-equipped system with an ATI X1900 XT card, 2GB of RAM, and many hundreds of gigabytes of free hard disk space--the same system on which I tested Photoshop CS3--it took Illustrator CS3 twice as long to launch as CS2 under Windows Vista; 10.3 seconds compared to 4.6 seconds. Under OS X on the same system, CS3 took 5.9 seconds. ( I lacked a copy of CS2 for Macintosh to run a comparison.) Limitations in the CS2 version of Live Trace made comparisons between the two impossible, though I can say that both versions crashed with memory errors attempting to trace a specific 10-megapixel file running under Vista--my main suspect is the graphics driver--while CS3 on my wheezy Windows XP machine managed to complete it and the Mac took a mere 5 minutes. (Live Trace is my Illustrator benchmark of choice because it ferociously exercises every computer subsystem.) So I can't point to any operation and declare that a speed improvement makes the upgrade essential. Still, for typical usage, it feels fairly responsive.
And finally, I'm disappointed at what Illustrator still lacks: Predominantly, the ability to natively handle double-sided pages. Even the supplied templates force brochures into two separate files for the inside and outside. So for all the frustrated print designers out there, I'm docking Illustrator a ratings point in Features for continuing to miss so basic a capability after all this time.
If it comes free in your Creative Suite 3 box, you won't lose anything by upgrading to Adobe Illustrator CS3 from CS2, and if you're a new user, then you'll find Illustrator the robust, capable drawing app it's been for years. But if you actually have to spend money to upgrade the individual app, think carefully about the features you think you're missing and whether Illustrator CS3 can really fill the gap. And if you need multipage support, perhaps it's time to give CorelDraw X3 a try.