This may be a screen resolution problem/bug with FF3.
I'm using Windows XP service pack 3, 1280X1024 screen size at 160 dpi (167%.) If you have a similar setup, this may work for you.
I modified firefoxportable.exe which I have installed on my local hard drive (since FF3 was unusable, I have FF2 still installed.) as follows , this finally worked for me:

1)Find your Firefox 3 Exe installation on your hard drive using windows explorer or search or you favorite file explorer.
2)Right click and select properties, select compatibility tab, check "disable visual themes" box in display settings (all other boxes should be unchecked) click OK..
3) Start firefox 3.
4)Type in "about:config" in the address bar.
5)In the filter type in dpi, or layout.css.dpi
NOTE: If you have no value, right click on the blank part and create a key called layout.css.dpi, the type should be "integer" not "string."
(I reset my value to an integer, it was showing as string. If you already have a key named layout.css.dpi with the type being "string" this fix MAY work without changing it to "integer," however, I changed mine by creating a new key, and deleting the key with the string value by clearing the contents.)
6)Right click and select modify.
7)Enter value of 1 and click OK. Changes will take effect immediately! You can try other values, however, for me values of -1, 0, 96, 144 or above did NOT work.
At this point in the modification (with the compatibility set to disabling visual settings, step two above) the changes do NOT require you to restart Firefox!)

Moderator, please post this in bug fixes!!!