I am using version 2 and was wondering do I need to upgrade to version 3. Or can I get by just using version 2
I've used both versions before, and there's nothing in version three that is enticing me to upgrade. I did it to support Terabyte. Version two was rock solid, as is three. The only issue I think you *might* have an issue with is backwards compatibility, not being able to read version three .tbi files. Also version three is supposedly a bit faster. But no, you don't "need" to upgrade. There have been no game-changers between versions.
depending on what you need it for. If it's been serving you well, keep v2. however, there are significant improvements built into v3. Much faster incremental backup/restore and full backup/restore have been packed into v3.
IFW Version 3 improvements... http://www.terabyteunlimited.com/upgradehist-image-for-windows.htm The TBOSDT scripts are much better in Ver 3.