My PS3 is fine. I've never had these problems with any other game. I'm not the only one, if you google GTA4 freezing you'll find a lot of forum posts regarding the issue. Mostly with 60gig PS3s, but I have a 40gig. It's also not limited to PS3, some 360 owners are reporting the problem also, but not nearly to the extent of PS3.
One rumor was that Gamestop got a bunch of bad discs, and this is where I purchased mine, so I will be returning it and buying from a different vendor. If this solves the problem, then maybe it is a bad batch.
I'm just pissed that at first I wasn't even going to buy it, then with the exellent reviews I was like ok why not, and then it's just locking up my PS3.