Hi sashbar,
Lightroom 3.6 or Lightroom 4 depending on whether you have a 64 bit machine or not is an interesting option to look at.
LR has the latest camera raw converter and adjustment capabilities...some photogs think the LR ACR is really improved from a quality of image perspective. And of course you would gain the ability to look at all of your images from a shoot, to rank them, to sort them, and to make all kinds of brightness, develop and cropping adjustments to the images. There is also a very powerful paint brush inside LR that allows you to selectively paint on brightness or contrast or any other adjustment that is available in the upper develop section. This gives you the power to visually manage your photo sessions, to crop and correct them, to selectively enhance them (including lens corrections) and then go out to an online web gallery, a slideshow or a multiple print sheets. It could be that the Photoshop CS3 Camera Raw is not capable of seeing your newer camera...but... LR Would be able to see and import almost all new cameras to date.
The great part of LR is that you can always export the pictures right into CS3 and work on them and then save them right back into lightroom without any problems or special steps. CS3 is the first version of Photoshop that was totally suitable for retouching portraits at a professional level...and of course travel and landscape images no problem too. It is my opinion that if someone wants Photoshop at a great price and wants good power then CS3 is a great version. The features they added in CS4,5 and 6 are all flashy and neat and all...but I dont use them too much honestly for high end professional retouching (maybe puppet warp in CS5 occasionally). All the essential good basics are in CS3 and it does not tax your memory or video card too much unlike other versions.
If youre happy with CS3...you have a good base foundation for most all that you would need for a majority of retouching and fix up in my opinion (I own CS4, 5 and 6 but I dont apologize for how good CS3 was). Owning Lightroom would get you up to date so you might NOT have to use the DNG work around (dont know what camera you have). It would also get you the latest/greatest RAW converter, updated for your camera possibly...plus all the management and adjustment capabilities that a lot of people are happy with. Just my opinion.
Cheers,
Ray