Is it possible to use Python 2.6 (or 2.7?) with ArcGIS 9.3?
The official stance is no, not supported. There are a number of reports in the wild though that it can be done. How is this accomplished? and is there anything to watch out for?
In all ArcGIS 9 versions you can upgrade python to the latest and greatest version with a few simple steps. Here's the recipe for 9.3 and 2.6:
This is an unsupported configuration, see ESRI knowledgebase article 31912.
Do you have any compelling reason to upgrade beyond 'because I want to?' Most popular third-party Python libraries are available for 2.5 and there's no point in risking major compatibility issues.
arcgisscripting should fail and throw with an error like "use of python25.DLL conflicts with this version of Python" when importing a 9.3.X arcgisscripting in Python 2.6 or beyond.