Finally, Randall Pozdena claims that he has dropped connections and modem freeze problems with his 3400. He doubts that it has anything to do with temperature but has found that zapping the PRAM fixes the problem. He claims that Apple recommended this as a solution. He was further told by Apple that "fixing the 3400 modem driver was one of the top priority items."
O'Grady's PowerPage continues to track modem problems with the 3400. A recent report suggests that problems are more common with FreePPP than with OT/PPP.
Update: FYI: If you want to measure the internal temperture of your PowerBook, try the Temperature control strip module included as part of Jeremy's Control Strip Modules (although it does not work on all PowerBook models).