At last, Apple has released a much-needed patch: iPhone OS 3.1.2 is out and it solves the sleep issue—in which the iPhone refused to wake up—brought in by the previous version. There are other fixes too.
• Resolves sporadic issue that may cause iPhone to not wake from sleep • Resolves intermittent issue that may interrupt cellular network services until restart • Fixes bug that could cause occasional crash during video streaming
It weighs 241.7MB. Go get it in iTunes. [Thanks Mark]