A month or so ago I finally broke down and upgraded our iPhones to 3G, and sold our old ones on Ebay. It worked out well.
Bought – 2 16gb iPhone 3Gs, $300 each + tax & misc AT&T fees.
Sold – 2 8gb first gen iPhones for $330 and $335 – about $20 each for Ebay/Paypal fees and shipping.
So the initial purchase is pretty well canceled out. The new service plan is eligible for corporate discounts, so hopefully my discount will cancel out the more costly monthly bill.