It's quite possible that the problem wasn't caused by the Safari upgrade (this laptop is getting rather old and tends to act up in hot weather). The reboot may simply have revealed some existing disk corruption. However, if you're going to try installing it yourself I'd recommend doing a full backup first just in case.
And Safari 3? It seems slightly faster, the movable tabs are quite nice (especially the way you can drag the contents of a pop-up window to a tab on your main browser window), it finally asks you if you're sure you want to close a window that has multiple tabs in it, and the TiddlyWiki title bar bug is fixed. Apparently they've also ported it to Windows.
ETA: I installed it on my home Mac Mini and it hasn't crashed horribly. I guess the increasing flakiness of my old iBook is to blame for the above problems then. I also discovered two other nice Safari 3 features: you can resize multi-line text entry boxes, and it includes a fairly impressive debugging tool for web designers (right click on anything in a page and select "inspect element" - I'm not sure if you need to have turned on the Debug menu with Tinkertool first).
ETA2: Restored my iBook's internal disk from the backup. Installed Safari 3 beta again. The machine locked up while shutting down for the reboot after the install had finished, but after a power cycle it booted up OK and seems to be running reliably now. I'm posting this update using Safari 3.