[Android Software/Hacking General [Developers Only]] jboxer:
Normally the XDA forums are for development discussion not for NOOB questions like this. A simple Google search would have answered most of these questions for you; but as a courtesy I will answer them this time.

If you have Donut (1.6) you need to go to an I-Mobile Service Center and ask them to update the phone to the latest 2.1 firmware. Once they have updated it to 2.1, you can do SD card updates in the future. The most convenient locations for people in Central BKK is MBK Center, 2nd Floor. The process will take about 45 minutes to one hour.

If you are technically competent you can download the r1632 file listed in this thread or on droidsans.com, but you have to make a change before you can do an SD card flash (first time only when going from donut to eclair). If you are in the least way uncomfortable doing this, go get your first update at MBK or another I-Mobile Service Center such as Software Park on Chaeng Wattana in Pakret, The Mall Tha Phra, and many other locations. If you are comfortable making the modification to the file, first install 7-Zip and Notepad++ onto your computer. Then run 7-Zip and set the default editor to Notepad++. Now go to where you downloaded the r1632 update zip and right-click on it. Use 7-Zip to open the archive. You will see a file named "update-validate-script". Right-click on this file within 7-Zip and select Edit (make sure you have previously set Notepad++ as your editor as the regular Notepad programs messes up these files). In the editor change "touchstone" to "cosmos". Save the file and exit the editor. 7-Zip will ask you if you want the file to be changed within the archive and you select YES. Now exit out of 7-Zip and make a directory named "update" on the root of a micro-SD card. Then copy the r1632 update file to the update directory. Rename the file "update.zip" and turn off your phone. If this micro-SD card is not in your phone do so now. Then hold down the "Menu" key (2nd key from left) while turning on the power (top button). After you feel the vibration you can let go of both keys. Your phone will boot into recovery mode. Press the button it says to update the phone from the sd card. Then confirm you really want to update. The flash will then update the phone to Android 2.1 Eclair. When it is done you will be prompted to press "Home" (3rd key from left) to reboot the phone. You should now delete the update directory on the sd card. If you want to use another micro-SD card in the phone after it boots remove the one you used for the update and put the desired card into the phone. Hot swapping micro-SD cards is okay. Again if you don't understand any of this or are uncomfortable please have an I-Mobile service center update the phone for you.

The AIS Smartphone plan is more than enough data for most people. I never use more than 250Mb in one month. If you want true 3G then go for TOT3G or I-Mobile 3GX. I-Mobile requires a Thai guarantor on all non-Thai new accounts. They have a Smartphone plan with 2Gb data and 100 minutes calling for 299 baht a month. I-Mobile uses TOT's 3G network and their Smartphone Plan is the best deal going on the TOT3G network. The only drawback is your phone will not work outside of Bangkok, Samut Prakhan and Thonburi Provinces. TOT is currently expanding their coverage Nationwide but that is still at least half a year off or longer.

If you don't mind Edge, AIS is the most reliable provider in Thailand for mobile data services. AIS will give you reliable Edge service anywhere within Thailand (with a few exceptions).

To learn more about Android phones and Android Google Android and start visiting websites. The main Thai language website is droidsans.com and there are so many English ones just start checking them out after you do a Google search. Also once you have a data plan just run the Android Market on your phone and there are literally thousands and thousands of free programs you can download and use.

Have fun.