Downpoint for Xcode 3.2.5 is that only IOS 4.2 is supported furthermore. I will soon describe in another article how to set Xcode 3.2.4 and 3.2.5 in parallel up on your system to use older SDKs as well.
To perform the steps described below open the according project in Xcode.
1. Change the SDK of the project
1. From the Xcode menu bar, select Project > Edit Project Settings
2. Select the "Build tab"
3. Select "All Configurations" under "Configurations"
4. Under Architecture > Base SDK, choose depending on what is available the according iOS SDK (for Xcode 3.2.5 iOS 4.2)
2. Change the SDK of the target
1. Make sure the right target is selected. In the menu bar top of the screen, select Project > Active Target > "DesiredTarget"
2. From the menu, select Project > Edit Active Target "DesiredTarget"
3. Select the "Build" tab
4. Select "All Configurations" under "Configurations"
5. Under Architecture > Base SDK, choose depending on what is available the according iOS SDK (for Xcode 3.2.5 iOS 4.2)
3. Support older iOS versions
If you want to support previous iOS versions, when you perform the steps under 1. and 2. in the same windows, under Deployment > iPhone OS Deployment Target, select the lowest version you want to support. Support for iPhone OS 2.x versions is deprecated for apps through the app store.