This recently came up in another thread. on FCP6.
I'd say pretty much the same applies to FCP7 as FCP 6 – except that the features for C3.5 are even more comparable to C4 than are C3.0. No interoperability between the new Compressor and the legacy versions of FCP, but many of us have always just exported QT movies fron FCP and used those as source fies. That can obviously still be done "working with" C4.
Is it worth the $49 for those who own FCS3? IMO, it's doubtful unless you do a lot of Web hosting work.