Me and my wife have a family plan, I have an iphone 4, she has the 3gs which is total junk now. And she isn't able to upgrade yet.... But I am. Would it be okay for me to use my upgrade for a refurb iphone for her?
Yup! They'll just upgrade your line, revert your line back to the iPhone 4, and switch the new phone to your wife's line. Just keep in mind that they will have to switch her SIM to a Micro SIM, so make sure everything is backed-up on your computer!