I have been away from XNA for a couple months and want to get back into it. I had a game I was currently working on, but it was done in XNA 3.1. What are the differences between the two, and is it worth updating?
I would say its very beneficial to update your XNA to 4.0 (especially if you want to work on windows phone 7)
There are a few changes (not a ridiculous amount though) between 3.1 and 4.0. Here is an excellent site that I have had bookmarked that will help you out! (its a cheatsheet) XNA 3.1 to 4.0 CheatSheet
XNA 4 restructured a lot of the graphics section of XNA, it also added support for more built in effects (as opposed to just BasicEffect.) XNA 4 also dropped Zune support and now supports Windows Phone 7 development in its Reach mode. Shawn Hargreaves posted a lot of comparison posts on his blog last year, for example http://blogs.msdn.com/b/shawnhar/archive/2010/03/12/reach-vs-hidef.aspx
There are a few breaking changes, as Shawn Hargreaves outlines here, as well as new features, et cetera. A discussion of "what's new" in XNA 4.0 can be found in the XNA documentation on the MSDN site. You'll have to evaluate the new features and changes in the context of your current game and see if its worth upgrading -- certainly I'd think you should do it for new games.