I have ArcGIS Desktop 10.0 SP3 running against ArcSDE 9.3.1 SP2 Oracle. Can I run "Upgrade Geodatabase" in ArcCatalog to upgrade the database to ArcSDE 10.0 SP3, or I have to upgrade to ArcSDE 10.0 first?
If it's offered as an option, you can use it. I'd recommend doing as few needless upgrades as possible. Make sure you have a solid backup before beginning the 9.3.1 upgrade, and don't feel shy about making an extra SDE user snapshot.