there’s an article in iphoneatlas.com referencing this issue (can’t link to it because I’m on my iPhone right now); it will also help if you update to 2.0.1 version through iTunes. As Shep mentioned, it does take a really long time the first time you install it, as well as the first time you sync.
You could also reduce the chance of freezes by removing previous backups via the preferences in iTunes (at lease for the iPhone-there’s a tab for Sync in prefs where you can remove previous backups, otherwise you’ll just be reinstalling the same backup that caused the crash in the first place).
I’ve had a lot of experience with this exact issue you’re describing, and it’s software not hardware related FYI (I was am early adopter of the iPhone 3G and even took my phone back to the Apple store and had them replace it, only to find the problem persist in my new phone).
Good luck, and update that version to 2.0.1!